Yahoo Japan switches to Google search

In a victory for Google and defeat for Microsoft, Yahoo Japan has opted to use Google's search engine rather than Bing.

If there was any doubt that Yahoo Japan is separate from Yahoo in the United States, let this dispel it: Yahoo Japan has signed a deal to use Google's search engine rather than Microsoft's.

The deal, reported Monday by All Things Digital, was confirmed later that day with a Google Japan blog post.

In the post, Daniel Alegre, vice president of Google's Asia Pacific and Japan operations, said Yahoo Japan will use Google search results and Google's technology for supplying the accompanying search ads. With such partnerships, revenue from the search ads is shared between the Web site and the company that supplies the ads, in this case Yahoo Japan and Google, respectively.

The deal is a blow to Microsoft, which has been working for years to match not just the utility of Google's market-leading search service, but also its scale. Yahoo plugged in Microsoft's Bing search engine to supply search results, but evidently Microsoft couldn't convince Yahoo Japan to follow suit in that prime market.

Yahoo is an investor in Yahoo Japan, but it's not the only one--Softbank holds a bigger share--so Yahoo Japan's decisions don't necessarily align with that of Yahoo.

Update, 11:28 a.m. PDT: In response to news of the deal, Microsoft cried foul and cited a failed Yahoo-Google tie-up in North America. In a statement, Brad Smith, Microsoft's general counsel, said:

This agreement is even more anticompetitive than Google's deal with Yahoo in the United States and Canada that the Department of Justice found to be illegal. The 2008 deal would have locked up 90 percent of paid search advertising. This deal gives Google virtually 100 percent of all searches in Japan, both paid and unpaid. It means there will be no search competition in Japan and that Google will end up controlling all personal search information for all Japanese consumers and businesses.
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