AdAge's Michael Learmonth Explains Microsoft-Yahoo Search Deal

“Only morons and kids click on ads,”
Michael (above) tells us.

AdAge’s Michael Learmonth:
The Online Search Biz
Needs to Be Blown Up

Yahoo’s 10-year partnership with Microsoft, which the Internet giant expects to generate $275 million annually, will disrupt the digital-search industry to the point where it needs to be rebuilt from scratch. That according to Michael Learmonth, senior editor at Advertising Age, who broke the news of the historic deal on July 27, 2009, two days before it was announced. Interviewed on The WIT Network, Michael says the agreement – stipulating that Microsoft will pay Yahoo 88 percent of search revenue generated on Yahoo’s owned-and-operated sites through 2015 – will likely allow the companies to control 30 percent of the entire market, thus putting a significant dent Google’s business.

“This whole economy is going to be shaken up, because many, many agencies and advertisers buy search through technology that links directly into ether Yahoo or Microsoft’s search-buying system,” Michael tells host Bill Brazell. “And all that needs to be sort of blown up and sorted out now – now that they’ve decided to join up and compete against Google.”

“Advertisers fundamentally want more markets. They want more options,” Michael adds vis-à-vis Google’s dominance in the current search marketplace. He also affirms the notion that banner ads have become ineffective: “Marketers are thrilled if they get a one-percent click-through. They’ve done studies. Basically, only morons and kids click on ads.”