Microsoft, Yahoo finalise search deal

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Microsoft and Yahoo have finalised the terms of a broad search and advertising agreement intended to help them compete more effectively with Google.

The companies announced the agreement, in which Microsoft’s Bing search engine would power Yahoo’s search results and Yahoo would provide premium search-advertising services for both companies, in July.

They had hoped to finalise the deal in late October but needed more time to work out the details.

In a statement on Friday, the companies said they hope that the transaction will close in early 2010 and that they welcome the broad support the deal has gotten from key players in the advertising industry.

In October, four ad executives and the president of the American Association of Advertising Agencies sent a letter to the US Department of Justice in support of the agreement. The DOJ is still reviewing the deal for possible antitrust concerns.

The agreement was nearly a year-and-a-half in the making, during which time Yahoo rejected acquisition offers from Microsoft. The stated goal of the arrangement is to offer stronger search competition to Google, which has about 70 percent market share. Combined, Microsoft and Yahoo make up most of the rest.