Google and Yahoo! Propose 10-Year Deal for Advertising

The Associated Press and other news organizations reported today on the huge announcement that Yahoo! will rely on Google advertising on its sites to boost its own profits. This is a gigantic announcement even though the various search engine companies have at times relied upon or partnered with each other. 

According to the AP: 

Yahoo Inc.'s efforts to revive takeover talks with Microsoft Corp. have reached a dead end, prompting the Internet pioneer to hire online search leader Google Inc. to handle some of its advertising sales.

It's still unclear to me whether this means Google keyword ads and other ads will come to dominate all of Yahoo! sites. If so, it kind of makes sense because the Google advertising system milks more profit out of every advertising dollar spent, at least that's my impression.

I have always found Google to be the better advertising system with the greatest return.

Here's the Google press release. This is as if the Los Angeles Lakers were now authorized to use all of the resources of the Boston Celtics. Two top competitors now working together, profiting more from the relationship. It's a win-win for these guys. But you have to wonder what's next? Perhaps a Google takeover of Yahoo!

And here's excellent analysis from BusinessWeek.