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Yahoo, Netscape strike deal

The "strategic business arrangement" to be announced tomorrow may reveal that Yahoo will manage the Destinations page on Netscape's site.

Netscape Communications (NSCP) and Yahoo (YHOO) tomorrow will announce a "strategic business agreement," a multimillion-dollar deal that calls for Yahoo to manage the Destinations page on Netscape's Web site, according to sources.

Netscape's Destinations is one of the most visited pages on the Internet.

Both companies declined comment beyond confirming a press conference tomorrow; Yahoo did say that its lawyers considered the deal of "material interest."

Sources said Netscape has been seeking bids from companies that might be interested in managing its Destinations site, and that the bidding was intense. Some expressed surprise that it might have already ended. The Destination page contains links to newsgroups, Internet yellow pages, travel, technology news, sports, and entertainment.

The deal would benefit both parties. Netscape would rather have another company manage Destinations' content while it continues to collect revenue. Yahoo gets visibility on a popular Web site and continues to leverage its strength in providing Internet content.

One source speculated that the deal could cost Yahoo as much as $20 million and that much of the payment was guaranteed. That could not be confirmed, however.

Also today, Netscape renewed its deals with four companies--Excite, Yahoo, Infoseek and Lycos--which will remain the premier search engines on its Net Search page.