NEW YORK (Reuters) - Microsoft and Yahoo inked a 10-year web search deal to better compete against market leader Google, but stopped short of combining their display-advertising businesses. The deal gives Yahoo much needed operating cash, but investors hoping for a shock to the system rather than a shot in the arm pummeled the company’s stock.
Yahoo shares fell 7.5 percent, while shares of Microsoft edged higher, and Google shares fell 1 percent in a mildly down market.
“Those that were looking forward to a take-out, the deal today was rather disappointing,” said Marc Pado, U.S. market strategist for Cantor Fitzgerald. “The 10-year pact, it’s not a bad thing. It’s not as good as what investors expected.”
Under the deal announced on Wednesday, Microsoft’s Bing search engine will be the exclusive algorithmic search and paid search technology for Yahoo’s sites, while Yahoo will be responsible for selling premium search ads for both companies.
Televisions upfront market appears to be ending for the season. Networks playing fast and easy with their ratecard to battle the competition of internet and the digital era.