Yahoo! and eBay have announced the beginning of a long term partnership today. It will grow Yahoo!'s Search Marketing and
eBay’s PayPal online ‘banking’ and payment system via Yahoo integration. With this partnership Yahoo! becomes the exclusive third party advertiser on eBay.com. Yahoo! also becomes the exclusive third-party provider of all graphical advertisements throughout eBay.com site.

Both are also joining forces to improve the Yahoo! Web search results for eBay.com and to provide Yahoo! search users with more up-to-date listings from the millions of products on the eBay.com marketplace.

Ina Steiner of AuctionBytes points out the difficulties that might creep in.

Let’s say I list an iPod on eBay for $19.95 and make it a featured listing. I’d be paying eBay 60 cents in listing fees and $19.95 for the Featured Plus upgrade so my listing will stand out on the search results pages. Imagine how I feel if right next to my featured listing is an ad for an iPod from a Yahoo Search Marketing advertiser that draws people away from the eBay.com website.

However, Yahoo! is in a win-win situation in the partnership.

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