Posted July 27, 2010 9:19 am by with 1 comment

Tweet about this on TwitterShare on LinkedInShare on Google+Share on FacebookBuffer this page

Holy smack in the face Batman! Yahoo Japan just signed a 2-year deal with Google!

Yes, with Google! Not, Bing!

Before the word “mutiny” jumps to your prefrontal cortex–your “mind” for the rest of us–you need to know this: Yahoo holds only a 35% stake in Yahoo Japan, so the search engine couldn’t put its foot down and insist that Bing be the search engine of choice.

Still, what an embarrassment! I mean, Yahoo Japan basically just told the world that its US sibling has made a terrible mistake and it’s not prepared to make the same one!

Of course, Yahoo is having none of that, releasing its own statement on the deal:

Yahoo! Japan announced that it has chosen to implement Google as its backend algorithmic search engine and paid search infrastructure. Yahoo! Japan made this decision as an independent and separate publicly traded company, in which Yahoo! holds a 35% equity interest. We amended our agreement with Yahoo! Japan as a result of this decision, and we do not anticipate that this amendment will have a material financial impact on our revenues. We will provide support, as required by our agreement, for the search experience Yahoo! Japan has chosen for its business, and we will continue to partner closely with Yahoo! Japan in other areas including mail, messenger, mobile, our content properties and more.

This decision by Yahoo! Japan does not impact the global rollout and implementation of the Yahoo! search alliance with Microsoft, except in the Japanese market. We remain confident in our transition plans for the search alliance, are driving innovation in the user experience around search on the Yahoo! network, and continue to be committed to our alliance with Microsoft.

So, what can stop this black-eye for Yahoo and Bing? Well, Japan’s regulators just might hold that key. Apparently, Google’s 53% market share in Japan and Yahoo’s 38% share will create one heck of a monopoly. So, maybe Yahoo Japan will have to partner with Bing by default. 😉

  • Double Down

    Actually, this could work out better for Yahoo US. A combined 90% share in Japan means more reach with improved relevance for consumers. Better relevance leads to more clicks. More clicks leads to more revenue. Yahoo US still gets a cut of that Yahoo Japan revenue.

    Pretty smart move in a twisted sort of way.