US Justice Department to investigate Microsoft/Yahoo! deal

The US Justice Department is launching an investigation into the proposed revenue sharing deal between Microsoft and Yahoo!.

Under the terms of the 10 year partnership, Microsoft’s Bing search engine will power Yahoo! search while Yahoo! will provide the worldwide sales force for both companies’ premium search advertising.

Microsoft will acquire an exclusive 10 year license to Yahoo!’s core search technologies, and have the ability to integrate Yahoo! search technologies into its existing search platforms. While Yahoo! will sell premium search advertising, Microsoft’s AdCenter platform will handle self-serve advertising for both companies.

The investigation could see conditions being imposed on the deal in order to stimulate competition or the partnership could be blocked.

Although details about the investigation have not been released, it is understood that Microsoft will be asked to disclose its spending on Bing.

Yahoo! said in a statement: “Yahoo and Microsoft are cooperating fully with the Justice Department and firmly believe that the information they will be providing will confirm that this deal is not only good for both companies, but it is also good for advertisers, good for publishers and good for consumers.”