Relatively quietly Yahoo has decided to outsource most of Yahoo Shopping to PriceGrabber. This is analogous to what Yahoo is doing with Microsoft-Bing in search — just not with Microsoft. Merchant listings will now come from PriceGrabber and e-commerce sellers will only be able to get into Yahoo Shopping via PriceGrabber or Yahoo Search (Bing).
This is interesting on many levels. It could signal the arrival of a “vertical outsourcing” strategy that moves to other verticals: autos, real estate, travel, local . . . It also seems to represent something a loss for Microsoft. While PriceGrabber has a larger product database than Microsoft there’s probably more than that in Yahoo’s decision not to simply work with Microsoft here, which would seemingly make sense given the search relationship.
Perhaps Yahoo doesn’t want to be too dependent on Microsoft across too many fronts. However, Bing sponsored search ads will be the ones that appear at the top of search results in Yahoo shopping (once the regulators sign off on the deal).
Let’s look at a page. The following represents my speculation about who will provide what going forward:

We’ve reached out to Yahoo for clarification and will update the post once we receive any. However my belief is that Yahoo will retain control over the user experience, search ads will come from Bing (in the future) and the merchant listings (the body of the page) will come from PriceGrabber.
There are also graphical/display ads in shopping. While PriceGrabber has a display ad program I would imagine that Yahoo will retain control over that business, as it has more broadly.
As I said we could be seeing the emergence of a kind of “formula” here for Yahoo in which it outsources data functions to high quality third party specialists and it retains control over display ad sales and look and feel.
This is a huge win for PriceGrabber; Yahoo Shopping is one of the most visited shopping engines online: