Digital Media Buzz > MicroHoo’s PM Mess: Two Years in the Making

MicroHoo’s PM Mess: Two Years in the Making

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Microsoft

By Niki Hammond

According to the press release, the Microsoft/Yahoo! search deal is expected to take approximately 24 months to implement following regulatory approval. This estimate has some people wondering why it should take so long and others doubting it will happen that quickly.

To get a sense of what’s likely to be happening during those 24 months, note that this is not just one big technology integration project. The deal is comprised of multiple points, each of which will be tackled by different (though probably overlapping) teams as distinct projects within Microsoft or Yahoo. Among the major projects that were initiated with this deal:

Integrate Yahoo’s Core Search Technologies Into Bing
A major opportunity for Microsoft to refine and improve its search platform, this aspect of the deal will not likely be fully implemented in just two years. Microsoft will have a 10-year exclusive license of Yahoo’s search technology, during which time Microsoft will need its best engineers to fully understand the nuts and bolts of the search technology, analyze the aspects that are compatible with Bing, discard or ignore the components that are redundant, and integrate any features or processes that could potentially improve Bing’s value and performance. Search engines are complex, ever-evolving beasts, and it’s unlikely that Microsoft’s project team will be able to accurately predict a completion date until its been given full access to all documentation and code and a few months to review it. One thing is certain: it will not happen overnight. Microsoft has been clear in its intent to make incremental improvements to Bing via increased query volume and improved relevancy. There are no plans to blanket-integrate Yahoo’s technology, and in fact Microsoft has been clear that the 24-month timeline relates to other aspects of the deal such as Bing powering Yahoo search and Yahoo’s salesforce taking over ad sales.

Replace Yahoo’s Panama System With Microsoft’s AdCenter Platform
Both companies’ self-service advertising will now be managed via AdCenter. While by no means a small project, this migration should be among the more straightforward steps toward fully implementing the deal. It will involve a data conversion/migration of all the data in Yahoo’s Panama system to Microsoft’s AdCenter platform. Data migrations can be tedious, but they’re done all the time and are usually pretty low-risk projects when experienced data experts are involved. Both Microsoft and Yahoo have data experts in spades.

Beyond the technical integration, it’s assumed that some level of data sharing for targeted ads and content in general will need to take place. The feasibility of doing this, however, is still a little bit fuzzy and may yield little strategic benefit to either party. Much of the data used for targeted advertising is protected by each company’s respective privacy policies and may not be shared.

Shift Microsoft Premium Ad Sales to Yahoo Sales Team
This project is less technical in nature but a major component of the deal and a critical success factor. Major personnel changes are usually accompanied by a dip in customer satisfaction. Anything less than a smooth, seamless transition to Yahoo’s sales team could turn off advertisers and open up opportunities for Google. To lessen the risk in such a transition, it may be wise for Yahoo to arrange to hire the key players at Microsoft who are involved in premium ad sales. We know that Microsoft is hiring somewhere between 400 and 550 Yahoo employees in exchange for $150 million over three years, but we haven’t yet heard of any plans for personnel changes in the opposite direction.

Replace Yahoo Search Engine With Bing on All Yahoo Properties and Services
This step, the core and focal point of the entire deal, is likely what most people are thinking of when they wonder about that two-year timeline. The deal thus far allows for some flexibility in exactly how Bing will replace Yahoo’s core search technology. It may be as simple as changing a form to execute a search via Bing and return a Bing search results page, or a seamless integration that would result in barely a noticeable difference for the end user. Since the deal stipulates that Yahoo will continue to own the user experience of its properties and Yahoo executives insist that the major benefit of this deal is that it enables them to focus more on their brand and other initiatives, it would be foolish of them to do anything less than a seamless integration with zero Bing branding on any Yahoo properties. Since the indexing of each is based on separate and distinct algorithms, Yahoo will have to make some decisions on whether to completely discard their current rankings and cease all efforts on their own search technology, or do some level of integration for a slower transition to Bing while Microsoft catches up on its integration of Yahoo’s search technologies.

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