Remember how Microsoft rejoiced having a deal with Yahoo USA last year after all the brouhaha? Its desperate attempt to become a minor number two in the search market competing with Google. Almost everyone was after Google like a pack of wolves to ensure the search giant wouldn’t sniff a deal with Yahoo and it continues to date. At least with Microsoft.
Google has struck an advertising deal with Yahoo Japan and that is hurting Microsoft. Why? I think don’t need to elaborate and my post yesterday on Google’s absolute dominance of the Search Market. With Google signing this deal, it would further solidify its position [though it really doesn’t need this]. However it would greatly benefit Yahoo, given that it will be leveraging Google’s dominance in both search and the ad market and it will most definitely not harm the Microsoft – Yahoo partnership but the Redmond, Washington based software provider has all the issues and things to worry about. A couple of those are:
It will severely damage a healthy competition for search and Google would become the dominant supplier of Ads in Japan for an indefinite period.
These can be legitimate concerns but we have seen that Japan’s Fair Trade Commission has given a green signal to this deal. This is unlike the troubles Google faced when the Justice Department called the Yahoo – Google partnership in the US to be anti-competitive. That is just a tale Microsoft would continue to cry over given it has failed itself at search and what ever little respect it could have mustered by cementing a more global partnership with Yahoo. Yahoo Japan on the other hand is steering clear of the fight between number 1 and number 3 in search business stating that Yahoo will use Google’s search technology but would keep its advertising business separate.
I feel a bit sorry for Microsoft though, the heads must be cursing a missed opportunity and being outmaneuvered by Google. Can’t Google give in a small percentage of search share to Microsoft, as charity? 
Jean-Baptiste Su is the technology columnist for L’Expansion, the leading business publication in France. He’s also the co-founder and editor of TechPulse 360, a blog at the crossroads of business and technology, exploring the innovation and companies defining the high-tech and clean-tech industries.
Jean-Baptiste started his journalistic career 18 years ago at IDG in France, first as reporter at InfoPC (PC World) and then senior editor at Le Monde Informatique (ComputerWorld). He later joined Decision Informatique, part of Groupe Tests (01 Informatique, 01net.com…) as senior editor, before heading to France’s financial daily newspaper La Tribune as its local Silicon Valley correspondent.
