Microsoft CEO Steve Ballmer on Thursday suggested that the software giant’s search deal with Yahoo is a global one and not just confined to the U.S. and Europe. The revelation came during the Microsoft (NASDAQ: MSFT) chief’s press conference in Tokyo during a swing through Southeast Asia.
“It’s possible that we would extend that partnership [with Yahoo] outside of the U.S.,” Ballmer told reporters at a news conference, a portion of which was posted to YouTube. “We will have to wait and see until we actually are able to get approval and consummate our partnership with Yahoo (NASDAQ: YHOO) inside the U.S., and perhaps there will be news on that some other day,” Ballmer added.
A company spokesperson confirmed in an e-mail that the deal is indeed an international one.
“The Microsoft-Yahoo agreement does apply outside the United States,” the spokesperson said. “As it’s written, it must be approved by regulators in the U.S. and Europe in order to go into effect. As soon as those regulators give approval, the agreement goes into effect worldwide.”
The companies have already submitted the deal to antitrust regulators in the U.S. and Europe, even though the agreement is still under negotiation.
There are caveats to expanding the deal worldwide, however. “Implementation in a specific country is postponed if regulatory approval is required there and it is not yet obtained. But that will not postpone implementation in other places,” the spokesperson added.
No doubt, though, that the move is a more serious threat to Google (NASDAQ: GOOG) than if the competition were restricted to just the U.S. and Europe.
After a tumultuous hostile takeover bid by Microsoft last year, Ballmer had dropped his outright pursuit of Yahoo in June, 2008. In late July, 2009, however, Microsoft announced a revenue sharing deal with its search competitor.
Last week, the two firms notified the Securities and Exchange Commission (SEC) that they need more time to work out the finer points of their landmark deal. Under the terms of the pending ten-year agreement, Yahoo would use Microsoft Bing to provide search capabilities to its Web sites, and share the advertising revenues with the software giant.
Still, the combination would create a stronger number two contender than the current situation with two almost minuscule also-rans confronting a single search titan. According to Web analytics firm Net Applications, Yahoo held 6.7 percent of the global search market, and Bing held 3.5 percent. The only other player to garner more than 0.6 percent was Chinese search engine Baidu.
Meanwhile, Google still reins as king of the hill with 84.5 percent of the worldwide search market. Theoretically, combined, Bing’s and Yahoo’s market shares would make a second place competitor with a share of roughly 10.2 percent.