Yahoo Inc. and Microsoft Corp have agreed to a new search partnership deal that will see Yahoo being able to display and sell its own ads on desktop search results, but only 49 percent of them.

Under the previous deal signed back in 2009 Microsoft had exclusive rights to sell 100% of all inventory against Yahoo’s desktop search results, but the deal didn’t extend to mobile where Yahoo was free to pick and choose which ads were displayed.

The new deal doesn’t change organic search results, which will continue to be provided to Yahoo by Microsoft’s Bing search engine.

According to a statement released by Yahoo, there will be changes under the new deal as to how ads are sold as well, with Yahoo no longer being able to sell ads for Bing, while vice versa Microsoft will no longer be able to sell advertising on Yahoo’s Gemini ad platform.

“Our global partnership with Yahoo has benefited our shared customers over the past five years and I look forward to building on what we’ve already accomplished together,” Microsoft Chief Executive Officer Satya Nadella said. “Our partnership with Yahoo is one example of the diverse partnerships we’ll continue to cultivate in order to have the greatest impact for our customers.”

Google onboard?

The opening up of just shy of half of Yahoo’s desktop search advertising inventory to advertising that doesn’t come from Bing opens up a slew of opportunities for Yahoo, including the possibility that Google could come onboard as an ad provider.

Yahoo has built its Gemini advertising platform up and it does well in providing mobile search ads and inventory across Yahoo’s content properties, but Google is still regarded as the leader in search advertising, not just by volume but by rate of return as well.

Yahoo would at least have to consider some sort of partnership with Google on ads, presuming it can overcome regulatory hurdles. Previous attempts for Google to provide ads to Yahoo were halted in 2008 when the Justice Department threatened to take action.

Either way the deal is a win for Yahoo in regaining some indepedence and control over its advertising, and in offering improved financial returns as a consequence.

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