According to reports, it is alleged that Marissa Mayer of Yahoo! and Sheryl Sandberg of Facebook have met to discuss a possible new search deal. Recently, the two companies have collaborated on a number of smaller projects, such as allowing Yahoo! to share its news on Facebook and have also agreed to settle a number of disputes over patents.
Facebook CEO, Mark Zuckerberg, has recently stated its intentions to go into search, commenting that its social network is "pretty uniquely positioned to answer the questions people have”. However, Facebook is new to business and this is where Yahoo! could come in. By combining Yahoo!'s know-how and search infrastructure with Facebook's huge user and database, the two could create a strong contender to Google.
That said, a deal with Facebook could throw Yahoo!'s current alliance with Microsoft's Bing into jeopardy - although it is rumored that Yahoo! has been trying, for a long time now, to extricate itself from that deal.
Source: The Telegraph