Microsoft’s Bing search engine will now power the Yahoo website and Yahoo will in turn become the advertising sales team for Microsoft’s online offering.

The deal ends years of back-and-forth negotiations between the two companies. Microsoft originally offered to buy Yahoo in January 2008 – with an offer worth about $47.5bn. Yahoo instead opted for an online advertising partnership with rival Google. But that tie-up was later abandoned because of the risk of a protracted battle with regulators over competition issues.

While Microsoft receives access to Yahoo’s search technology, Yahoo receives a big bump in annual revenues, 88% of the search-generated ad revenues from its own sites for the first 5 years of the 10-year deal, much higher than is standard in the industry.

What is good news for SEO is that with Microsoft and Yahoo using just one engine, there is now one less engine to keep track of. Additionally, the combined market share of these giants of the Internet cannot be overlooked either. The tie-up will give Microsoft and Yahoo a combined market share in the US search ad market of about 30%.

Let’s see what unfolds…