SAN FRANCISCO/SEATTLE (Reuters) –
Microsoft Corp and Yahoo Inc inked a 10-year Web search deal to better compete against market leader Google Inc but stopped short of combining their display advertising businesses.
Yahoo shares fell 10 percent as some investors were disappointed by the limited scope of the deal, which did not include any upfront payments for Yahoo as some had expected. Shares of Microsoft edged higher, while Google shares fell 1 percent.
“Those that were looking forward to a take-out, the deal today was rather disappointing,” said Marc Pado, U.S. market strategist for Cantor Fitzgerald & Co. “The 10-year pact, it’s not a bad thing. It’s not as good as what investors expected.”
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