Microsoft may hire 400 Yahoo staff
Updated on 05 August 2009
Microsoft will hire at least 400 workers from Yahoo if US government regulators approve the companies' proposed internet search partnership, and Yahoo will receive $150 million (£88.6 million) to cover any unexpected costs during the switch to new technology.
The details emerged in a regulatory filing that elaborated on an agreement announced last week.
Sunnyvale-based Yahoo said then that an unspecified number of its 13,000 employees would be offered jobs at Microsoft after the Redmond, Washington-based software maker assumes control of the search results and search advertising on Yahoo's website.
The transition is supposed to begin early next year, assuming the alliance is approved by antitrust regulators in the US and Europe.
Microsoft will pay $50 million (£29.5 million) annually during the first three years of the 10-year contract to supplement the revenue that Yahoo will receive from the ads appearing alongside its search results. The $150 million (£88.6 million) in guaranteed payments weren't mentioned last week.
The filing said Yahoo can use the $150 million (£88.6 million) to pay for unforeseen transition costs.
Most of the revenue from the Microsoft deal will flow from ad commissions. Yahoo will receive 88% of the search ad revenue during the first five years of the contract.
After that, Yahoo's commission will range from 83% to 93%, depending on whether it still handles some of the ad sales in the partnership.
Transferring 400 workers to Microsoft would prune Yahoo's current payroll by about 3%.
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