Yahoo in a deal with Google on search ads!

TechCrunch was right after all. Internet media giant Yahoo has confirmed a deal with search engine giant Google.

The two giants of the web have signed on a non-exclusive partnership on search advertising.

Analysts believe that the deal is large enough to generate around $800 million in annual revenue.

Yahoo would now be running Google powered ads on their search result pages on some of the search results in USA and Canadian market.

Yahoo would have the option to decide on where and when to run Google powered ads.

The deal is for a period of four years though it can later be extended to 10 years.

Yahoo said that they expect to generate around $250 million to $450 million in additional operating cash flow through this deal in the first year itself.

The deal is Yahoo’s attempt to avoid Carl Icahn’s attempt to replace their board of members. Icahn is also aiming to replace Yahoo chief Jerry Yang.