Report: Apple, Yahoo in talks on deeper iOS integration

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Apple (NASDAQ:APL) and Yahoo are in discussions to integrate Yahoo Web services more deeply into the iPhone and iPad user experience, The Wall Street Journal reports.

Yahoo weather and finance apps are already preloaded on iOS devices, and other Yahoo data helps power Apple's Siri voice assistant. Citing sources with knowledge of the talks, the report states Apple and Yahoo are now exploring a deal that would encompass more pre-installed Yahoo content and/or an expanded Siri partnership.

In addition, Yahoo is mulling options to provide search data to Apple, in turn reducing Apple's reliance on information and services from archrival Google (NASDAQ:GOOG). However, the possibility of a search pact is considered remote: Google is already under contract as the default Web search provider on iOS devices, and while Apple no longer pre-installs services like Google Maps and YouTube, insiders say Apple executives like Senior Vice President of Internet Software and Services Eddy Cue believe Google delivers a superior search experience compared to competing services, and they are unwilling to sacrifice the quality of iOS search results.

Yahoo's 10-year search partnership with Microsoft (NASDAQ:MSFT) also poses obstacles: While Yahoo controls the look and feel of its search tools, Microsoft's Bing search engine provides the actual query results.

Representatives for both Apple and Yahoo declined to comment.

Yahoo President and CEO Marissa Mayer has called mobile the company's "top priority," and is looking to the platform to recharge its business. "I think the opportunity for growth (in mobile) is very fundamentally one of the things that drew me to Yahoo," the former Google exec told The Wall Street Journal earlier this year. "When you think about mobile... When you see triple-digit growth in some areas, there's a big opportunity for growth. Yahoo has the content that people want on their phone."

Mayer has also said that because Yahoo does not manufacture its own mobile devices or own its own mobile OS, browser or social network, it must rely on partnerships to boost usage. "There is really an opportunity for strong partnerships and that's what we'll be focused on," she said earlier this year at the World Economic Forum in Davos, Switzerland.

For more:
- read this Wall Street Journal article (sub. req.)

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