Yahoo taps into Google's ad network, expertise

Yahoo is counting on rival Google to help accelerate its revenue growth. As part of a non-exclusive arrangement announced on Wednesday, Yahoo's website will begin drawing upon Google's massive online advertising network to show marketing messages related to the content that's being perused.

Google Inc already distributes similar ads to thousands of websites, a service that has helped establish it as the Internet's most prosperous company.

Google retains part of the revenue generated from the ads shown on its partners' sites. The revenue split with Yahoo wasn't specifically disclosed, but Google has previously said that website owners that display the kind of ads covered in this agreement usually get to keep 68 per cent of the revenue.

Last year, Google's ad sales on its partners' sites totaled $12.5 billion. That amount includes ads shown next to the search results on other websites, a service it isn't providing to Yahoo.

That's because Yahoo already depends on Microsoft for most of its search-driven advertising as part of a long-term deal signed in 2009.

Yahoo aligned itself with Microsoft Corp after a proposed partnership with Google in 2008 unraveled when the US Justice Department threatened to file a lawsuit to block it. The Justice Department contended that Google would have been able to use its dominance of Internet search to thwart competition if it were able to expand its reach on to Yahoo's popular website.

This time around, Google and Yahoo aren't working together in search advertising.

Yahoo Inc has been struggling to attract more advertisers in recent years, even though more marketing budgets have been shifting to the Internet. The company's revenue had fallen in three consecutive years before registering a small gain last year.

CEO Marissa Mayer, a longtime Google executive before being lured away nearly seven months ago, has pledged to produce more impressive growth in future years.

Analysts have been predicting that Mayer's old ties with Google might eventually lead to a closer relationship with Yahoo. Yahoo's chief operating officer, Henrique De Castro, is also a former Google executive.