Microsoft, Yahoo near Web search deal

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EATTLE -Microsoft Corp. appears to have finally persuaded Yahoo Inc. that together they would have a better chance of mounting a meaningful challenge to Google Inc.'s dominance of online advertising.
Details of a long-rumored Microsoft-Yahoo alliance were expected to be announced Wednesday, a person with knowledge of the talks told The Associated Press. This person spoke Tuesday night on condition on anonymity, confirming earlier reports, because the deal was not yet final.
The deal does not appear to call for Microsoft to pay Yahoo in advance, which could disappoint its investors. Yahoo Chief Executive Carol Bartz had said she would join forces with Microsoft only for "boatloads of money."
Instead, the companies would share revenue generated by search ads on their Web sites. Yahoo would use Microsoft's search engine, Bing, and it is likely — though not certain — that a "powered by Bing" message will appear on Yahoo's highly trafficked pages, according to the person who described the talks to the AP.
The companies would also use Microsoft's advertising technology to deliver appropriate ads alongside search results, while Yahoo would handle the ad sales and customer service.
The person with knowledge of the talks said it is not clear whether the final deal will also cover sales of billboard-style "display" ads, or what will happen to Microsoft's own ad sales team.
Microsoft, the world's largest software maker, has been courting Yahoo for several years in hopes of expanding its share of the online search market.
After being repeatedly rebuffed, Microsoft launched an unsolicited bid to buy Yahoo in its entirety. With co-founder Jerry Yang at the helm, Yahoo put up such staunch resistance that Microsoft withdrew its last offer of $47.5 billion, or $33 per share, nearly 15 months ago.
Yahoo shares have never gotten close to that level again, and the company's market value was around $24 billion this week.
Microsoft is counting on Yahoo's search engine, which ranks No. 2 with a worldwide market share of 8 percent, to pose a more formidable challenge to Google, which holds 67 percent of the global audience, according to the most recent data from research firm comScore Inc. In the United States, Google's share is 65 percent, compared with roughly 20 percent for Yahoo.
Despite spending billions to upgrade its search engine, Microsoft still held just a 3 percent share worldwide and 8 percent in the U.S. in the most recent comScore tally.
The deal is likely to draw antitrust scrutiny. Last year, the U.S. Justice Department analyzed Yahoo's plans for a search advertising partnership with Google before deciding that it would give Google too much control over the market — a conclusion loudly supported by Microsoft. The opposition forced Google and Yahoo to scuttle their deal.
Microsoft is doubling down on Internet search at the same time Google is attacking Microsoft's bread-and-butter business of making software for personal computers.
Google is working on a free operating system for inexpensive personal computers in a move that could threaten Microsoft's Windows franchise. If it gains traction, Google's alternative, called Chrome OS, could divert some revenue from Microsoft while the software maker is trying to grab more of the money pouring into search advertising.

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Suicide bombers hit Afghan city

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aliban militants have tried to carry out multiple suicide attacks on government buildings in the eastern Afghan city of Khost, officials say.

They say at least six attackers wearing suicide belts targeted the main police station, but were killed in a gun battle with security forces.

Another militant died in a suicide car bombing. At least 17 people were wounded in the violence.

It comes amid a rise in attacks ahead of the 20 August presidential election.

The interior ministry says six suicide bombers armed with machine guns and rocket-propelled grenades attacked Khost's police station and nearby buildings on Saturday.

"All of the bombers who had suicide vests on their bodies were identified and fired at by our brave police before they reached their targets," the ministry said.

It was unclear which attackers were shot dead by security forces and how many managed to detonate their vests.

The suicide car bomber injured a number of policemen at an old military hospital in the city.

Defence officials said an eighth attacker may have got away.

In total three security officers and 14 civilians were wounded in Saturday's fighting. One civilian is in a critical condition, a defence ministry spokesman said.

Security worries

One of the presidential candidates, Ramazan Bashardost, was in Khost but was not affected.

The attack is a big blow to the authorities who have promised better security for the elections next month, says the BBC's Bilal Sarwary in Kabul.

Such attacks will only add to the worries of local Afghans in the country's restive south-eastern provinces.

After attacks in Khost, Paktia and Ningarhar provinces recently, security was beefed up specifically on the outskirts of the city which borders Pakistan.

According to local residents, all vehicles coming in and out of Khost were checked on regular basis.

In May, six people were killed when militants launched simultaneous assaults on government buildings in Khost.

Last week at least four security personnel were killed in attacks on Gardez, about 50 miles (80km) northwest of Khost, when militants attacked the police chief's office, a police station and the intelligence directorate, as well as the governor's compound.

Another security official died in an attack in eastern city of Jalalabad.

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