TechDirt's Mike Masnick has an interesting post over at Forbes that suggests the Microsoft/Yahoo deal is much ado about nothing:

Looking at Yahoo!'s new deal with Microsoft, it looks like it's still
fighting that last battle. It's still playing catch-up. It's still
looking for search market share, rather than relevance. The search
battle is no longer a battle at all. Microsoft may have built a quality
search engine in Bing (the reviews are lovely), but for most people,
Google is good enough. The battle is over in search. There's no reason
to shift to another player, because there's very little discontentment
with what Google provides. Microsoft (and now Yahoo!) may pick up some
users on the margin, but the market for search is no longer interesting
or particularly important.

He argues persuasively that Microsoft, Yahoo!, and others should be looking elsewhere for internet "relevance." 

People are discovering that information finds them, rather than them
going in search of information. Search already works. The next
interesting challenge is in improving the way information finds you,
rather than the way you find information.

It's a strong point that Chris Anderson also made in a recent Spiegel interview.  While I think Mike may be underestimating the potential for the new partnership to grow share, the argument that internet is moving beyond search is a powerful one.

MS/Yahoo! is NOT About Search.  It's About Search Advertising.

What Mike seems to miss is that this deal, however, is that it is not really about "search."  It's about Search Advertising, with a heavy emphasis on "advertising."  From a business perspective, Search is little more than a vehicle for advertising.  Search may not be the future of how people find information online, but it seems pretty clear that advertising will be a critical part of how the Internet funds itself for the foreseeable future.   

Will Bing/Yahoo dethrone Google as the world's most popular search engine?  Mike is right to suggest that's unlikely.

But that isn't the point of this partnership.  It seems more likely that this pact is designed to make both companies better online advertising competitors.  Search advertising is currently the largest and most profitable part of online advertising, so in order to be a credible contender for advertising dollars, Microsoft/Yahoo needs to be in the game here…and currently, they rarely are as AdAge explains:

While it decreases the number of players from three to two, advertisers
said the impact will increase choice, because even some large agencies
don't port their search campaigns to all three because of the
complexity and cost of doing so.

This deal should give Microsoft and Yahoo the "foot in the door" they need for large advertisers.  While selling search ads is the primary focus of the deal, I doubt it is the end game.   In fact, that might be one of the reasons Yahoo! was willing to forgo "boatloads of cash" upfront in order to be the salesforce for Bing.  Having relationships, a serious salesforce, and powerful, integrated management tools will be just as necessary to sell the advertising through the new platforms that help information  "find you" too.