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May 7, 2009

Yahoo to Take Over Microsoft Ad Sales? Not Likely

The latest reports about negotiations between Microsoft and Yahoo suggest the two have entered a period of "meaningful" talks and may strike a deal before too long. While details are obviously murky, Boomtown has heard that under the deal being discussed "Yahoo would take over both search and display advertising sales and Microsoft would run the tech for both behind the scenes."

That will never happen, according to one knowledgeable source at Microsoft. First, Microsoft is too focused on the long-term importance of digital advertising to sign away control of its sales operation. The company is heavily invested in that marketplace in terms of both people (well over 1,000 in U.S. sales alone) and products (40+). Can Microsoft trust Yahoo to sell MSN, Microsoft Media Network and its other products with the same vigor and knowledge it brings to the table when peddling its own properties? And would Microsoft's famous executive egos ever outsource something as crucial as ad sales?

According to the source, the answer to both questions is no. "There's no way in hell is Microsoft going to give Yahoo control on its properties," he said.

Posted by Zachary Rodgers at May 7, 2009 2:47 PM

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