Thursday, May 25, 2006

Yahoo, eBay Sign on For More Exposure

Internet portal Yahoo and online auctioneer eBay announced a wide-ranging search and advertising pact designed to withstand Google's encroachment.

As part of a multi-year partnership set to begin testing over the next several months with a full roll-out later this year, Yahoo and eBay inked exclusive agreements on key technologies as well as co-branded tools enabling them to expand their reach.

Yahoo becomes eBay's exclusive provider of graphical ads, as well as sponsored search advertisements, which is key to competing with Google. In return, PayPal will be the exclusive payment service across Yahoo's e-commerce and advertiser networks.

Additionally, Yahoo will be added to eBay's toolbar, which the San Jose, Calif.-based auction service said 4 million users downloaded. Yahoo will examine "click-to-call" advertising, which would allow Yahoo Messenger users to directly contact advertisers via eBay's Skype Internet phone service.

EBay, Yahoo and Google spokespeople were not available for further comment.

The pact, which first undergoes several months of tests before a complete roll-out later this year, was hailed as extending advertising and exposure across the popular Internet destinations.

"EBay provides us with a great opportunity to further extend our sponsored search and graphical advertising reach to one of the largest and most active communities on the Web," Terry Semel, Yahoo's CEO and chairman, explained in a statement.

For the online auctioneer, Yahoo's audience "drives massive traffic through its rich consumer content and premium services," according to Meg Whitman, eBay CEO and president, in a statement.

For some time, the auction service has reportedly been in talks with Yahoo and Microsoft over a partnership that could wean eBay from its dependence on Google.