Microsoft is getting closer to a deal to become the default search provider for Verizon Wireless, according to a report on Tuesday in The Wall Street Journal that cited people close to negotiations.
Microsoft would share ad revenue with Verizon, under terms being considered, with guaranteed payments to the wireless carrier of $550m (£350m) to $650m over five years, or twice what Google offered, according to people familiar with the deal. Microsoft is also reportedly negotiating to put its Windows Mobile operating system on more Verizon devices. The combined deals are valued at $1bn.
Reports Microsoft was trying to hijack the Verizon deal from Google surfaced last week after Google bowed to federal regulators' opposition and pulled the plug on its advertising partnership with Yahoo. Microsoft showed its desire to move into Google's search territory earlier this year when it made a multibillion-dollar bid to buy Yahoo.
Competition
Win a Yoggie Gatekeeper Card Pro
Gatekeeper Card Pro is designed to protect laptops in and out of the office. Enter soon though, as the competition ends on 17 November
While mobile search is still a nascent market, Google controls the lion's share with 61 percent, followed distantly by Yahoo with 18 percent and Microsoft with five percent, according to Nielsen numbers.
Google's preoccupation with regulators over the Yahoo deal reportedly helped create the opening for Microsoft with Verizon, the sources told the newspaper.
The move comes as the two companies ramp up their efforts in the mobile arena. The first phone based on Google's Android mobile operating system — a challenger to Microsoft's Windows Mobile — recently went on sale.
