Yahoo! Search senior vice president Shashi Seth announced today that a key milestone in the Yahoo! and Microsoft Search Alliance has been achieved: Bing now powers 100 percent of Yahoo’s organic (or natural) search results.  Apparently this is the case now for both the desktop product and mobile.

“Yahoo! Web, Image, and Video search experiences on both desktop and mobile devices are now powered by the Microsoft platform in the US and Canada (English), with more markets to come,” said Seth. “The speed in which this was completed is a testament to the great work and partnership between a number of Yahoo! and Microsoft employees, the ranks of which are numerous.”

Earlier this month, Yahoo! and Microsoft representatives reported that the transition was underway and that just about 25 percent of Yahoo’s natural search results and about three percent of paid search results were, at that point, powered by Bing.  They had set as early October the complete transition for both aspects of search, so completing the organic piece of the integration just a few weeks later is testament to the speed with which the joint team is executing.  There has been significant concern among search marketing professionals that the integration of the two platforms might not be completed in time for the all-important holiday season, so achievement of this first milestone will come as some relief to all concerned.

“We continue to work hard on the migration to adCenter, and are optimistic about completing this phase later this fall,” said Satya Nadella, senior vice president, online services division at Microsof.  ”As we have said all along, our primary goal is to provide advertisers with a quality transition experience in 2010, while being mindful of the holiday season.”

For folks who’s organic or natural search rank on Microsoft’s Bing is lower than what it was in Yahoo! Search, it’s very important to begin working on your website to optimize it for the Bing search algorithm.  Use your tools in the Natural Search Optimizer module of the Yield Web Marketing Suite to ensure your site is in the best possible condition and to check your rank in Bing.  Also, for further information, check out the Bing Toolbox for webmasters. And, as always, if you have questions, email or call our Customer Success Reps who are available to assist you.

In yesterday’s Yahoo! Search Blog, they announced that they’ve begun a test incorporating Microsoft’s Bing search results in their pages.  They are displaying both natural and paid search results, but only in about 25 percent of Yahoo’s search results pages.  Here’s what you can expect to see:

Further, Yahoo! says their mobile search product will begin to incorporate Bing mobile search results in the coming weeks and months.  Notable is Yahoo’s assertion that they will “continue to innovate and enhance the overall consumer experience around those core listings.”  This means that while the search results themselves will be generated by Bing, other on-page features or enhancements will be driven by the Yahoo! Search team.

For this and other reasons, you will continue to see how your keywords rank in natural search results across Google, Yahoo! and Bing throughout and following completion of the Yahoo!-Bing search integration within the Yield Web Marketing Suite and our Natural Search Optimizer.  It is entirely possible that your keywords may rank slightly differently across Yahoo! and Bing based on a variety of factors throughout the integration process.

For all of our customers, rest assured we remain on top of these changes and will work to ensure all changes are seamless to you, even as we continue to keep you abreast of these changes as they’re occurring.  If you have any questions, don’t hesitate to contact your customer success rep.

One of the best ways to ensure your website ranks well for your most important keywords in natural search results is through in-bound links to your site.  But how do you attract them (short of begging other website owners to link to you)?  We’ve got some tips and tricks below that will help you build links to your website.

Before we get started, though, just a quick reminder about links, link juice and the social etiquette of linking:

First, not all links are created equal.  Google, Yahoo! and Bing all evaluate links to your website relative to the quality of the source of the link.  So, for instance, if you get a link from The New York Times it’s vastly more important to the search engines than if Yield Software links to you (we hope one day soon we’ll be in the same league!)  In practical terms, what this means is that the NYT link has more juice than the Yield link, and when the algorithm is determining what your page rank should be, it’s weighing the link juice of each individual link.  Other types of sites that provide powerful link juice are links from .gov sites and links from .edu sites, in addition to links from mainstream media source sites or very popular blogs such as BoingBoing or ReadWriteWeb.

Second, link unto others as you would have the link to you.  If you hope to generate lots of great links to your site, you must also be someone who sensibly links regularly.  The social etiquette of the Web dictates that website and blog owners conscientiously link to the sources of news, information, reference material or other sources of content; this, in turn, will inspire web publishers to link to you.  By declaring you’re a good netizen, people will want to engage you more.

Now, on to those recommendations!

“Top” Lists

One of the all-time best ways to get people to link to your content is through lists.  For instance, the top 10 best ways to evaluate a purchase.  Or three things to consider when making a purchasing.  Remember that your “Top” lists should have some relevance to what your site is all about, but SHOULD NOT be an overt promotion of or commercial about your products and services.  These should be objectively helpful lists that people would intuitive want to share with friends or colleagues or family members (for instance, in their own blogs or via a tweet on Twitter or in a post on Facebook.)

Video

After social networks, like Facebook, video is the hottest segment of the Web.  People can’t get enough of video!  So a good way to get people to link to your site or your blog is use video.  It’s super easy to embed a video in your site (especially if you’re publishing your website or blog on a content management system like WordPress).  As with “Top” lists, be sure to choose videos that relevant to what you do, sell or serve.  If you produce and publish your own videos (which you should!), again, make sure you’re doing something that is going to be useful to people.  How-to videos are hugely popular on the Web, particularly if it’s about something emerging that people want to do but don’t yet understand.

Photos

Believe it or not, photos are still very popular and capture people’s eye.  Photos that capture an amazing moment, or are somehow instructional in nature can always drive interest, links and traffic to your site.

Downloadable Content

Publish content on your site that is new, unique or unlike something folks can get elsewhere.  Perhaps it’s a how-to guide relating to your industry or the services you provide.  If you have the budget, commission a white paper or a study on some important aspect of the work you do.  Or maybe you’ve been doing a great job with your blog over the last few years and have a collection of blog posts that, when taken together, make a terrific e-book on a subject relating to your business or work.  There are a whole number of online e-book publishing sites that enable fast and easy production, and which you can then offer for free download on your site.  It’s easy to say, “oh, no one cares as much as I do about the thing I do” — but guess what: you’re NOT that unique!  If you love what you do, chances are there are a whole bunch of people (potentially tens of thousands, even) who share your interests and passion.

Graphs and Graphics

Another great, link-worthy strategy for your website and blog is the use of graphs and graphics.  From simple charts and graphs created by Excel to timeline graphics, tag cloud graphics and workflow illustrations, folks love great visuals that bring into specific relief that which may be difficult to imagine.  There are many free or low-cost graphic creation tools across the Web (do a search!) that enable you to simply plug in a number of data points and return a beautiful illustration that you can copy and publish.  If you have a little budget, you can also always hire graphic artists to create stunning visualizations of either data or workflow or technology stacks (among many other options.)

At the end of the day, content, even in the 21st century, is still king.  If you consistently publish good stuff on your website and blog, it will be link-worthy.  And when you do publish, don’t be shy about publicizing that fact.  You should copy the URL of your new content and paste it into tweets on Twitter, your Facebook updates, your LinkedIn updates and any other sites where you can provide updates of what you’re working on.

Once you’ve gotten into a rhythm, be sure to see how your site is ranking for your keywords across Google, Yahoo! and Bing. If you’re a Yield Software customer, you can do this quickly and conveniently by clicking on the Natural Search tab in the Yield Web Marketing Suite and checking your link counts.  You’ll also be able to see the sources of those links so you can evaluate how well you’re doing in terms of link juice / link source quality.

The San Francisco Bay Area chapter of the Search Engine Marketing Professional Organization (SEMPO) has announced a new Meetup that will feature leaders from Yahoo! Search and Microsoft’s Bing discussing the coming integration of the two search engine giants.  Here’s the details:

What: SEMPO-SF Bay Area Learning Series: Inside the Yahoo! and Microsoft Search Alliance

When: Monday, July 26, 2010 at 6:00 p.m. PDT

Where:  Microsoft Corporation – San Francisco Centre, 835 Market Street, Seventh Floor, Golden Gate North & South Rooms, San Francisco

One of the most significant developments in the search marketing industry recently has been the formation of the Yahoo! and Microsoft Search Alliance, which promises to bring together the Yahoo! Search and Bing networks to provide advertisers with greater scale and faster innovation. As a search marketer, are you ready to adapt your marketing strategy to take full advantage of this paradigm shift?

Join SEMPO San Francisco for Inside the Yahoo! and Microsoft Search Alliance. This event will feature in-depth presentations from Yahoo! and Microsoft transition leads, followed by a question and answer session. Post your own questions and vote on questions from others here.

At this event you will hear about:

• Overview of the Yahoo! and Microsoft Search Alliance and what it means
• Implications and benefits of the search alliance for advertisers
• Updates on feature differences between platforms
• Share next steps specific to a customer’s transition options

Speakers include:

• Jon Mette, Senior Strategist, Search Optimization & Strategy, Yahoo!
• Michael Elmgreen, Account Executive, Search Agency Sales, Microsoft
• More to follow…

You can follow SEMPO-SF Bay Area on:
Facebook
LinkedIn

Learn more and register here:
http://www.meetup.com/SEMPOSanFrancisco/calendar/14035004/

Twitter is suddenly more all over the news than usual. So what’s all buzz?

Turns out, lot’s of things.

First, let’s start with the big event: today was the first day of Twitter’s inaugural developers’ conference called Chirp. This is a gathering of just under 100 geeks at San Francisco’s Palace of Fine Arts who build applications that rely on Twitter feeds (or APIs) to provide a Twitter-related service to end-users (that would be you and me.) Company co-Founder and CEO, Evan Williams said that developers using the Twitter API make about three billion calls a day into the service.

These applications make it easier for individuals and businesses to, for instance, send tweets from their desktops or mobile devices across multiple accounts (Seesmic or TweetDeck), or to send pictures via Twitter (TwitPic), or to analyze how well you or your brand is doing in the Twitterverse.

Second, a bunch of numbers were announced today. Company co-Founder Biz Stone said Twitter now has nearly 106 million registered users and adds about 300,000 new users per day worldwide. So, that’s a lot. What’s really notable is that about 75 percent of Twitter’s traffic is from outside Twitter.com – that is, all those applications I mentioned above are driving the lion’s share of tweets that are broadcast around the world every day. The other big number is that Twitter handles about 19 billion search queries per month either on its own site or via the API – which makes them second only to Google in total search queries per month.

That takes us to the third thing: revenue. Since it broadcast its first tweet in March, 2006 everyone has wondered one thing: how will Twitter make money? Four years later, they’ve got an answer. Promoted Tweets.

According to Twitter COO, Dick Costolo, Promoted Tweets will be a system whereby businesses can bid to promote their own tweets into top-of-stream conversations around particular topics. For instance, say you’re Paramount Pictures and you’re promoting a new movie with opening night parties in cities around the U.S. So you blast out tweets saying “Find an opening night party at a theater near you.” Today, you send that tweet out and it quickly becomes buried under all the tweets that follow it. With Promoted Tweets, each time someone includes your keyword – say, the movie’s title, or the name of its principal star – your tweet will quickly follow-on that tweet to the same group of followers. If Paramount’s tweet gets re-tweeted, clicked-on or favorited, such actions will somehow accrue to the benefit of the advertiser (it isn’t exactly clear how, but I’m guessing its akin to Google’s performance-based quality score for ads in its AdWords system).

“All that exist in our monetization platform are tweets,” Costolo said. “Everything is a tweet. A Promoted Tweet is a tweet. You can do anything to a Promoted Tweet that you can do to a regular tweet.”

Pretty cool. Especially for those of us in the advertising and marketing world looking for ways to appropriately engage in the twitterverse without looking pushy or like we’re trying to interrupt something. Bidding on search keywords became Google’s cash cow; it’s clear Twitter is hoping that bidding on keywords in tweets could become a big cash generator for them.

Speaking of money, the fourth big thing is that Twitter is now developing features and functions within its own sphere that will compete directly with some of the applications built by the very third-party developers Twitter is hosting this week at Chirp. As you might imagine, this is profoundly anxiety-producing for start-ups who’ve built their whole business model around the Twitter API and features that heretofore were absent from the core Twitter offering. So there are more than a few geeks sweating over this. Still, Twitter’s new monetization scheme is something they’re willing to share with Twitter developers who build Promoted Tweets into their applications – in fact, they’ve proposed a generous 50 / 50 split for advertising revenue. So, bad news and good news for developers.

But why, you may ask, should I care about the whole Twitter phenomenon at all? Isn’t it just another fad??

Well, in the same way that blogging seemed to come out of nowhere and then radically altered the ways in which people acquire and consume news, entertainment and information, Twitter is altering the realm of casual conversation. Its created a global water cooler and, from time-to-time, an outlet for breaking citizen-reported news. Remember that immediately following the devastating earthquake in Haiti, the first accounts out of the country were via tweets and TwitPics. The same has been true for countless other natural and man-made disasters over the last four years.

Many also believe that Twitter played an outsized role in the extraordinary campaign for the U.S. presidency in 2008. And because Twitter updates now flow seamlessly into Facebook updates, which is also enjoying phenomenal growth among all age segments, more and more people around the world rely on Twitter – whether they know it or not – for their just-in-time / just-enough news, gossip and daily life updates.

Which leads to the last big announcements relating to Twitter this week:

• Google announced that it will make the entire Twitter archive available via its search engine in the coming weeks.
• Microsoft’s Bing announced that it will now elevate relevant tweets in its search results based on real-time trending data.
• Google has also announced that it is incorporating Twitter’s “@anywhere” API, which Twitter announced last month and which makes it easier for third-party websites to incorporate Twitter functionality, into Google’s new service Follow Finder. Just enter your Twitter handle and Follow Finder will recommend other Twitter members who are not yet in your “following” list.
• The U.S. Library of Congress will now officially archive the entire Twitter archive dating back to its opening day in March 2006. Now anything you may have tweeted during that time – and I mean anything – is now resident in the august chambers of our nation’s most prestigious library. Horrifying, no?

Twitter’s impact on the social and cultural landscape worldwide is, presently, incalculable, and its clear the young company isn’t content to rest on its laurels. These changes, together with the exciting new apps still yet to emerge from its ecosystem of developers, portends more exciting announcements to come.

We often get questions from customers about which search engines would be best to run their search ads on. What search engines, they often ask, present the road most likely to get them to advertising success?  While in most instances the answer is “optimize across all three major search engines to get at the best possible results”, for some businesses it may make sense to focus on alternative strategies.  But how?

In order to answer this question, let’s think about what you are looking for in a search engine and what pay-per-click (PPC) advertising objectives you’re trying to reach. The answer usually includes some variation of the following:

You want…

exposure and results – leads, sales, strong word-of-mouth, etc.

at an…

affordable cost-per-click and a profitable return on investment.

I’m sure it’s not breaking news, but this scenario can often be quite a challenge for many businesses — particularly small businesses — to achieve. Most businesses just starting out on PPC advertising try out Google because it’s well-known and because, let’s face it, it generates about 65 percent of the total search traffic on the Web. But there are some alternatives out there that may produce results as good as or better than Google at a lower overall cost per acquisition. Sometimes, in other words, it’s best to consider the road less traveled.  Try thinking about your options like this:

1) The Interstate – Google

What’s possible: huge exposure and profitable campaigns.

What’s required: bigger budgets (i.e., $1,000 per month for less competitive keywords; tens of thousands of dollars or more per month for very competitive keywords) and hard work.

For exposure and volume of visitors, this is the place to be seen. And Google is more than capable of bringing in very good results. However, it is also the winner in the categories of highest cost per click and budget you’ll need for exposure.  Because there is such high traffic and competition on Google, they’ve had to institute some very stringent measures in the form of a quality score system, which can be tough to understand and navigate if you are not an expert.

So, although it’s a big wide road with lots of traffic, Google isn’t a casual Sunday drive. This search engine requires a detailed map with lots of turn-by-turn instructions to actually achieve real results.

2) The Side Road – Bing

What’s possible: decent exposure and profitable campaigns.

What’s required: a medium-size budget (i.e., starting at $750 per month for less competitive keywords in less competitive markets).

Though a side road, Bing is no bumpy byway you use only to avoid heavy traffic – in fact, we’ve found Bing can be a shortcut to great online advertising results. Our recent experience with PPC ad campaign results from Bing is, quite simply, “Wow!” If you haven’t tried it yet, it would be well worth your while to give it a shot.

Bing very often provides a lower cost-per-click than Google, which means a lower budget is required for full exposure. Bing also offers a much easier on-ramp since its quality guidelines are much less opaque than Google’s. With Bing, you can just turn on something basic and get good results without all the hassle of divining what your quality score is and why. We’ve also seen very impressive traffic quality and conversion results from Bing over the last couple months. It looks like Bing is certainly on the rise as a search engine and should not be underestimated.

3) Well Off the Beaten Path – Business.com

What’s possible: modest exposure and profitable campaigns.

What’s required: smaller budgets can suffice (i.e. $250 per month for less competitive keywords).

While everyone has heard of Google and Bing, not everyone has considered Business.com. Many businesses just don’t have the budget to compete for the keywords in their space and markets on Google and Bing. Many of these advertisers, however, have found PPC advertising success with Business.com. It’s the exact same style of advertising as conducted on Google and Bing, but for much lower costs, while still delivering results. So if your budget is too limited for Google and your space is too crowded on Bing, try out Business.com.

4) Off-Road – Facebook

What’s possible: targeted exposure and profitable campaigns.

What’s required: small-to-medium size budgets.

Though not exactly the same sort of PPC advertising as the others, the ad platform on Facebook is similar in many ways to what you will find on Google, Bing and Business.com.  On the Facebook platform, you specify keywords that folks you’re targeting use in their profiles and updates, and you can also specify demographic, psychographic and geographic characteristics to further target your ad.  While mostly text, Facebook ads can also include a single graphical element, which its easy-to-use system helps you to incorporate into your ads step-by-step.

Facebook is vying with Google to be the most-visited website in the world (it may have already surpassed Google, in fact), and it’s a traffic source that should not be overlooked.  Because it’s not exactly the same kind of thoroughfare as the search engines listed above, you do need to spend some time understanding the differences and nuances involved.  But don’t let that deter you from experimenting with this potentially rich source of traffic to your website.

5) Uncharted Territory – Yahoo! Search

What’s possible: good exposure and profitable campaigns.

What’s required: larger budgets.

Later this year, Bing and Yahoo! will integrate search engine operations, and Bing will begin providing results for searches completed on Yahoo!  Currently one of the top three most visited sites in the world, with an enormously popular email system and some of the best-trafficked content portals on the Web (think Yahoo! Finance, Yahoo! Personals or Yahoo! Autos), Yahoo! Search should not be overlooked.  Still, it’s clear this search engine is in a state of massive transition.  It can be tough to optimize campaigns on Yahoo! and its rules are in many ways quite dissimilar to those in use on Google and Bing, which means you need to bring a whole different intuitive sense to using the system.  And costs-per-click for your keywords are often similar (or identical) to Google’s, though you can get some bargains on Yahoo!  Finally, in our experience traffic and conversions from Yahoo! have fallen behind Bing’s performance of late, so while there are still opportunities on Yahoo!, it’s probably best not to use Yahoo! as a primary search advertising conduit until the Bing-Yahoo! integration is completed late this year and early next year.

Currently, the Yield Web Marketing Suite makes it both easy and profitable to coordinate and optimize your PPC ad campaigns across Google, Yahoo! Search and Bing.  And we’re actively looking at how to expand to include additional PPC ad platforms.  But let’s face it: in most cases, the best road map for acquiring traffic at the lowest possible cost is optimizing your PPC campaigns across the three best-known, most-used engines: Google, Yahoo and Bing.  Our services experts are always available to you to help you to get the most from your pay-per-click advertising campaigns and to provide objective advice about roads less traveled, so never hesitate to ask for help.

It certainly took a little time.  But all the bureaucratic issues have been resolved.  Microsoft and Yahoo! have now received regulatory clearance to form the Yahoo! and Microsoft Search Alliance in the United States and European Union.  What this means, essentially, is that Microsoft’s Bing search engine results will combine in some form with Yahoo’s, and the pay-per-click advertising platform for both engines will be powered by Microsoft’s adCenter.

Though Yahoo’s spin on what comes next seems slightly different from Microsoft’s, there is some agreement on the fundamentals.

According to the official Microsoft announcement, after the Yahoo! and Microsoft Search Alliance is implemented, you will:

Reach more potential customers. Search ad inventory from both the Yahoo! and Microsoft networks will be joined in a new, unified search marketplace powered by Bing, with a combined audience of over 150 million searchers in the U.S and nearly 577 million searchers worldwide.

Save valuable time and effort. You’ll use a single platform — the Microsoft adCenter — to manage your campaigns easier and faster. With just one buy, your search ads will reach users on Bing, Yahoo!, and other premium partner sites and networks, such as The Wall Street Journal Digital Network, msnbc.com, FoxSports.com, Facebook, and Buy.com.

Yahoo, for its part, also seems to have plans to continue to innovate in the field of search independent from Microsoft, and Yahoo’s sales force will also sell specific search services on behalf of the joint effort.  In general, this should be very good for PPC advertisers.  The ROI on Bing campaigns has been, generally speaking, very impressive but they’ve lacked volume since launch.  By combining Yahoo! search volume with Bing’s, advertisers should see hefty benefits.

For all subscribers to the Yield Web Marketing Suite, the transition will be seamless for you and you’ll continue to receive all the benefits of managing your paid search campaigns via our systems.  Our teams are on top of both current and coming changes, and you’ll still be able to manage your PPC, SEO and landing page optimization campaigns for all three search portals from a single, simple interface.

Both Yahoo! and Microsoft have committed to bringing the Search Alliance to the U.S. by the end of 2010, prior to the crucial holiday season, with additional countries following on a staggered schedule beginning in 2011.  Again, for all our subscribers managing campaigns across multiple geographies, this transition will be seamless for you throughout.

As new information becomes available, we’ll be sure to keep you updated here on our Community Blog and via our weekly newsletter.  As always, if you have questions or concerns, don’t hesitate to call our Customer Success Reps Monday – Friday, 9 a.m. – 5:30 p.m. PST at 1-877-943-5379.

The New York Times Bits blog (see our blog roll on the right) said it has inside scoop that Google will announce a new music service next week in L.A.  They report:

Several reports today indicate that Google is set to introduce a music service at an event at the iconic Capitol Records building in Hollywood on Oct. 28. The service, we’ve confirmed from three people briefed on the details, will offer searchers a better way to find and sample music on Google — much in the same way people can get detailed financial information about a company from Google Finance.

According to this and other reports, Google is teaming up with iLike (which is owned by MySpace, which, in turn, is owned by Fox/News Corp.), Lala and Imeem.  For folks who search on a band or a specific music title, Google will show a page dedicated to the artist or the song, including biographical info, song lyrics, photos, listings for upcoming concerts and links to music streams on partner sites.

Meanwhile, The Times is also reporting that Facebook will add Lala to its gift store.  Remember that Microsoft’s Bing powers search on Facebook, and Bing has moved aggressively to match moves made by Google in recent months, so it may only be a matter of time (or mere minutes) before we here of a similar effort by Bing, though it should be noted that Bing already does a great job of doing what Google will apparently announce next week.

For instance, using the example in the The Times blog post, take a look at the Bing result for Green Day:

Now take a look at the same search query on Google:

So maybe Google feels it has some catching up to do with Bing.  Maybe Bing will feel it has a few deficits relative to Google’s new offering, so it, too will announce partnerships (probably with Facebook, since they’re already in bed together).  In any event, it’s all good for search marketing — ever more queries will continue to come on to the search engines.

Tweets from users on Twitter have hit the big-time: they’re now going to be featured in search results on Bing and Google.

For those geeks among you who follow news from places like Twitter, Google and Microsoft (maker of Bing) like I do (it’s not a particularly scintillating life I lead…), you were no doubt enthralled with yesterday’s unfolding events.

First there was this blog post by Biz Stone, Twitter’s chief:

…there are already tens of thousands of Twitter apps and more to come because people want the choice to consume and create tweets wherever and whenever they prefer. The folks over at Bing took a keen interest in Twitter and worked fast to establish a working relationship with us in line with our open approach.

Twitter is providing Bing access to the overwhelming deluge of public, real-time tweets rushing in from all around the world so they can help you find those that make the most sense right now. While Twitter currently presents tweets based simply on timeliness, Bing is experimenting with new solutions such as “best match.” We hope more working relationships with organizations in the search business will mean even more variety for users.

Which, of course, was a not-so-coy reference to Google (OMG!) Sure enough, the ever-present and elegant Marissa Mayer, Google’s chief guru around all things search, sent a tweet (”Google and Twitter!! Yay!! http://bit.ly/183svN“) announcing they, too would integrate tweets from Twitter. From her blog post:

…we are very excited to announce that we have reached an agreement with Twitter to include their updates in our search results. We believe that our search results and user experience will greatly benefit from the inclusion of this up-to-the-minute data, and we look forward to having a product that showcases how tweets can make search better in the coming months. That way, the next time you search for something that can be aided by a real-time observation, say, snow conditions at your favorite ski resort, you’ll find tweets from other users who are there and sharing the latest and greatest information.

Here’s Yusuf Mehdi, a senior vice president at Microsoft, previewing Twitter integration with Bing search results at this week’s Web 2.0 Summit here in San Francisco:

This is great for users because Twitter is often the place to get first-person, “on-the-ground” reports of breaking news or leaking information. By seeing real-time results of tweets from Twitter relating to any given topics in context with other information, particularly reports researched, verified and edited by professional journalists, can be a powerful way to stay informed. It’s also a great way to forensically understand how it is events unfold because there are so many points of view on the event.

It’s great, too for advertisers on Google and Bing who bid on search keywords. Because there is a finite amount of search inventory for the vast majority of keywords, any opportunity to increase the volume of searches overall creates more opportunities for advertisers to insert relevant messages when and where audiences are expressing a related interest. The challenge for advertisers, of course, is keeping track of rising and falling memes (or topics) in order to place timely bids on keywords or phrases relating to those topics or issues that are suddenly on the rise. Still, it’s an opportunity.

The day has finally arrived.  Microsoft and Yahoo have figured out how to partner together.  And, it was all done under the unparalleled scrutiny of incessant press and blogger coverage.  Congratulations to Steve Ballmer and Carol Bartz.  You get an A+ for persistence.

There are a lot of purists and contrarians criticizing Yahoo for entering into this agreement, most of which presumes a loss of entrepreneurship, innovation and competitive advantage.  However, let’s set the story straight.  Yahoo has been struggling in the search marketplace for quite some time.  They have seen their market share erode and have not shown any signs of turning that around.  Google, through their simple user interface and continuous innovation, has claimed the search marketplace as its own.

What options were left for Yahoo?  Dethroning the market leader is never accomplished with a “me too” strategy.  Either they would have to out-innovate Google (which, given their history, would be nearly impossible) or they will have to compete with scale by “merging” with other like-minded competitors.  Why is this surprising to so many people?  The same story has been played out many times across a large number of industries.

Jerry Yang, Yahoo’s co-founder and recently-departed CEO, refused to let Yahoo be acquired by Microsoft, which turned out to be a huge mistake as the economics have gotten significantly worse since Microsoft’s first offer.  So, why did Yahoo persist in working on a deal under their new management?  Why didn’t they hold out for a better offer?  The reality is that there is only a single partner that they could legitimately work with to pose a competitive threat to Google.  That is a hard spot to be in, as there is no chance of getting into a bidding war and improving your outcome.  The deal was done because the benefits of doing a deal outweighed those of the status quo.

So, let’s talk about the benefits.

First, on the cost side, there are huge economies of scale to be had by having a single sales and, more importantly, a single development organization focused on search.

Second, many companies advertise only with Google because of the time and resources it takes to manage search campaigns.  Now, they can get significant distribution by advertising with Microsoft and reaching all Microsoft and Yahoo search properties.  This will cause many advertisers to consider expanding their search efforts to include Microsoft.

Third, for users life is simple.  Everything should be completely transparent.  They will go to the same web sites, with the same user interfaces.  The only difference is that the search ads will be served up by Microsoft (apparently with a “powered by Bing” tag on each Yahoo search result page.)

For advertisers, however, there are both pros and cons.

First, the pros: as we’ve seen in the financial sector, creating large-scale marketplaces for transactional commerce—such as the NYSE or Nasdaq—creates a more efficient marketplace and grows the market in aggregate.  So, a result of this union should be that publishers receive better calibrated revenue associated with each ad placement and likewise advertisers should pay more accurate prices for each click.

The downsides: first, prices for ads that were under-priced will see a rise as rates calibrate.  As an example, in our own client base, with the introduction and increased volume of Bing in the last month, we have seen sub-$2 per-click keywords at Microsoft become more expensive than the same keywords at Google.  Something to keep an eye on.  The other concern for advertisers is the mention in today’s announcement that Yahoo will serve as the “relationship sales force for both companies’ premium search advertisers.”  Will this mean a non-premium advertiser (i.e. most of us) will be at a competitive disadvantage to the premium advertisers? Seems likely.

As far as Yahoo is concerned, it seems clear they have made the decision to focus on their core strengths – content and display.  This is the right decision in a trying time in their history.  And it’s good for Microsoft, too.  If they didn’t do this deal, we would have seen both Yahoo’s and Microsoft’s search efforts slowly fade into the shadows of irrelevance.  This would be devastating to consumers and advertisers alike who want and need to have choice.

It will take time for Microsoft and Yahoo to work out the details and integrate their platforms.  And the anti-competitive / anti-trust forces are already massing to oppose this deal, according to the Wall Street Journal, which might cause further delays.

In the meantime, the clock is still ticking for businesses trying to attract and acquire customers using search marketing.  Thus, companies of all sizes will still need to leverage all three search engines–Google, Bing and Yahoo–to meet their business objectives and outpace their competitors.  All of us here at Yield Software are here to help you do just that.