The agreement does not cover each company's Web properties and products, e-mail, instant messaging, display advertising or any other aspect of the companies' businesses. "In those areas, the companies will continue to compete vigorously," they stated. The transaction will be subject to regulatory review and the agreement entered into Wednesday anticipates that the parties will enter into more detailed definitive arrangements prior to closing. The pair acknowledged that their deal will "be closely reviewed by the industry and government regulators" and they welcome questions.

Under the 10-year agreement, Microsoft will acquire an exclusive license to Yahoo's core search technologies, and Microsoft will have the ability to integrate Yahoo search technologies into its existing Web search platforms. Microsoft's new search engine Bing will be the exclusive algorithmic search and paid search platform for Yahoo sites. "Providing a viable alternative to advertisers, this deal will combine Yahoo and Microsoft search marketplaces so that advertisers no longer have to rely on one company that dominates more than 70 percent of all search," the firms said in an indirect jab at Google.