Yahoo and Ebay has formed an alliance yesterday. It would be for mutual benefit as this would allow Ebay's paypal to be used in Yahoo's operations, and will allow yahoo to have an exclusive deal to sell display ads for ebay. Ebay in turn would gain more visitors and probably preferrential search engine placements.

Google has been slowly moving in to ebay's turf with the introduction of google base and the rumored google payment system. Google also announced yesterday a partnership with Dell computer to install google's software on its computers. This would mean a worthy competition againts microsoft's bid to control PC software specifically with the PCs default search engine preference.

Overall, Yahoo has the most benefit with all these alliances. As Google is dominating the internet advertising arena, yahoo would hopefully close the gap with this alliance.

Stock prices of ebay and yahoo both increased due to this announcement.

[more at washington post ]