Yahoo! Inc. (YHOO), Yelp Inc (YELP) Partner Up To Improve Search

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According to the Wall Street Journal, Yahoo! Inc. (NASDAQ:YHOO) CEO Marissa Mayer announced that the company was partnering up with online review site Yelp Inc (NYSE:YELP) at a staff meeting last Friday. The marriage of the biggest companies starting with “Y” in the Internet sector will allow Yahoo to incorporate Yelp’s local business listings and user-generated reviews into their search results. Yahoo fell behind search leader Google Inc (NASDAQ:GOOG) several years ago and is searching for a way to claw back some lost market share.

No details on Yahoo – Yelp deal yet

Although representatives from all of the major news organizations have contacted both Yahoo! Inc. (NASDAQ:YHOO) and Yelp Inc (NYSE:YELP), spokespeople for both companies have refused to comment so far.

Search engine market share

Google is clearly the dominant player in the search market, and Yahoo has dropped to a distant third. As of December 2013, Yahoo! Inc. (NASDAQ:YHOO)’s share in the search market was a mere 10.8% compared to Microsoft Corporation (NASDAQ:MSFT)’s 18.2% and Google Inc (NASDAQ:GOOG)’s dominant 67.3%.

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Yelp Inc (NYSE:YELP) already has similar partnerships to its deal with Yahoo in place with Microsoft Corporation (NASDAQ:MSFT) and Apple Inc. (NASDAQ:AAPL). The local business information Apple uses in its mobile mapping software is derived from Yelp listings.

The majority of Yahoo! Inc. (NASDAQ:YHOO) search engine software is licensed through a deal with Microsoft Corporation (NASDAQ:MSFT). The deal gives MSFT 12% of all revenue Yahoo earns from search ads.

Mayer tried to buy Yelp in 2009

Technology news outlet Tech Crunch reports that Yahoo! Inc. (NASDAQ:YHOO) CEO Marissa Mayer has had her eye on Yelp Inc (NYSE:YELP) for a long time. According to the article, back in 2009 Mayer had pitched buying Yelp for $500 million to her bosses at Google, but the deal eventually fell through. In hindsight, the acquisition of Yelp might have been such a good deal for Google Inc (NASDAQ:GOOG) that Mayer might not have left.