A filing with the SEC has now unveiled further details into the Microsoft Yahoo deal. Among the items revealed is the fact that Microsoft will be getting some Yahoo employees. As part of the transition plan, the filing says:
Microsoft will hire not less than 400 Yahoo! employees (the “Transferred Employees”) and will offer the Transferred Employees market competitive compensation packages. In addition, Yahoo! and Microsoft will mutually agree on a retention plan to be paid for by Microsoft to assist in retaining the Transferred Employees and an additional 150 Yahoo! employees to be mutually agreed upon between Microsoft and Yahoo! to assist with providing the transition services.
The deal is of course supposed to last for ten years. For the first five, Yahoo will be able to receive 88% from Microsoft’s search. Yahoo will also be entitled to its share (at the Revenue Share Rate) of the net revenues generated on Syndication Properties after the Syndication Partner’s share of net revenues is deducted, according to the filing.
After the fifth year, Microsoft will have the option to terminate Yahoo’s sales exclusivity for premium search advertisers. If they do that, the Revenue Share Rate will increase to 93% for the remainder of the term.
If Yahoo chooses to retain its sales exclusivity, its revenue share would be 83% for the remainder of the term. If Microsoft does not exercise its option, the Revenue Share Rate will be 90% for the remainder of the term, the filing says.
Microsoft will also pay Yahoo $50 million a year for the first three years. This is for transition and implementation costs. You can read the entire filing here for all of the details.
