Yahoo Maps Out Move to Microsoft's adCenter

In an important first step in advancing their strategic alliance, Microsoft and Yahoo said on company blogs that they plan to transition Yahoo's advertising customers over to the software titan's adCenter system in time for the holiday shopping season.

Failing that, however, Microsoft (NASDAQ: MSFT) and Yahoo (NASDAQ: YHOO) will then shoot for early 2011 in order to not cause havoc for advertisers during the critical holiday period.

"We know how important the holiday selling season is to many of you, so our aim is to complete the transition in the U.S. and Canada before the start of the 2010 holiday season," said a post Thursday on the Yahoo Search Marketing blog.

"If we determine that we cannot transition with quality before the holiday period, we’ll defer the transition until the early part of 2011," the Yahoo post continued.

In order to make the switch for Yahoo advertisers to adCenter as painless as possible, Yahoo said it will begin the process months ahead of time.

"To provide as much flexibility as possible, we intend to offer a window of several weeks in late summer, during which you can choose the time to initiate and complete your transition," Yahoo said.

The move is one that advertisers have been waiting for ever since the two companies' inked a 10-year deal, which calls for Yahoo to swap advertising revenue for the use of Microsoft's Bing search infrastructure, was given the green light by government regulators in February.

The deal is not limited to the U.S. and Canada, however.

"We’re working toward completing this transition in the U.S. and Canada before the start of the 2010 holiday season, with additional countries following on a staggered schedule beginning in 2011," Carolyn Miller, an adCenter spokesperson, wrote in a post on the adCenter Blog.

What advertisers gain by staying with the Yahoo and Microsoft alliance, Miller said, is an audience of some 154 million searchers in the U.S. and another 15.7 million in Canada. The global potential advertising audience is more like 577 million people, according to Microsoft's estimates.

In the meantime, Microsoft is advocating that advertisers start getting prepared for the transition. For instance, suggestions on Microsoft's Transition Center include improving the relevance of keywords and ads.

The deal between Yahoo and Microsoft was the result of what began as a hostile takeover bid by Microsoft, a move that was repeatedly rejected by Yahoo brass.

After what appeared to be a final rejection, Microsoft and CEO Steve Ballmer withdrew their offer but continued to query Yahoo, particularly after the smaller company brought in a new CEO, Carol Bartz, formerly head of AutoDesk.

Then, in late July 2008, the two companies surprised the IT industry with this advertising-search partnership agreement.

The final agreement between the two was finally signed in December.

Stuart J. Johnston is a contributing writer at InternetNews.com, the news service of Internet.com, the network for technology professionals.