Microsoft to Compete with Bing Despite Yahoo Deal

SUNNYVALE, California (Reuters) – Yahoo Inc said on Monday it has revamped its search to compete against Microsoft Corp’s Bing, even as it relies on the Redmond giant to power its queries.

The announcement of plans to put a new face on Yahoo Messenger and Mail and add functions to its search engine came after news that Google and Yahoo each lost a fraction of a point of U.S. search share to Microsoft last month [nN18441019].

“We are not a version of Bing,” Prabhakar Raghavan, a senior vice president of Yahoo, said to reporters at the company’s headquarters.

“We are Yahoo and that will continue…We collaborate on the back-end but we are competitors on the front-end,” he said,

At a press event held at their headquarters, the company gave more details of its complex relationship with Microsoft.

At the end of July, Microsoft and Yahoo signed a 10-year deal under which search on Yahoo’s websites will be generated by Microsoft’s new Bing search engine. The companies hope the deal will take effect early next year.

Microsoft will license Yahoo’s search technology, allowing it to integrate certain aspects of it into Bing. Microsoft’s advertising search product, AdCenter, will also replace Yahoo’s equivalent product, Panam