Microsoft and Yahoo: The Borg is back!

The decline and fall of Yahoo continues. Should Google be looking over its shoulder?

By Andrew Leonard
Published July 29, 2009 5:02PM (EDT)

At a conference last year, reports Farhad Manjoo in "The Case Against the Case Against Google," Christine Varney, the new head of the Justice Department's antitrust division, said, "For me, Microsoft is so last century. They are not the problem. I think we are going to continually see a problem, potentially, with Google."

In light of the news that Microsoft has cut a 10-year deal with Yahoo to merge their search engine operations, perhaps Varney should rethink her position, at least a little bit. Microsoft was a distant third in the search engine universe. Now, at a single stroke, it is No. 2. Henceforth, Yahoo's search results will be provided by Bing, Microsoft's own newly rebranded, and positively reviewed, "decision" engine.

Glyn Moody, writing in ComputerWorldUK, thinks the deal is expensive for Microsoft, but the advantages to the move are obvious. From a financial standpoint, Microsoft can now score bigger advertising deals. From a technical perspective, the key to improving search engine performance is crunching a lot of data on what people are searching for and using that information to refine results. Microsoft now has access to vastly more info on what people are looking for than ever before.

Bing already works pretty well, if your metric of success is that it returns Googlish-looking results. But I'm guessing that Google is unlikely to be alarmed. If anything, the news might even be welcomed by Google, as it shoots a big hole in the theory that Google is the 21st century version of Microsoft, lording it over the Internet universe without any significant competitors in sight.

For Yahoo, it all has to feel a little sad. Long ago, in the prehistory of the Web, as a freelance writer who was pretty excited about this thing called the Internet, I wrote a tiny little squib for Wired magazine, "Yippee for Yahoo," announcing the news that two graduate students at Stanford had received venture funding from Sequoia Capital. Back then, start-ups that got the Web like Yahoo were seen as the anti-Microsoft, and the fact that co-founder David Filo was a free-software geek made it all the better.

From now on, every Yahoo search result will be "powered by Bing."

For Jerry Yang and David Filo, that's gotta hurt.

Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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