It is officially happening. Microsoft and Yahoo! just received clearance from the powers that be (i.e. the U.S. Department of Justice and European Commission) to begin implementing their search deal within the next few days.

Forgot what the “Microhoo” search deal was all about? Allow me to refresh your memory. The Microsoft-Yahoo! announcement came in July 2009, stating that the two were joining forces to compete with the ultimate search-giant Google. Who’s doing what in this deal?

Think of Microsoft as the brains of the operation. Microsoft’s contribution is the search technology, as Bing will be the sole supplier of organic content for both sites. Yahoo!, on the other hand, is the beauty (or the brawn), and will develop an appealing, engaging and satisfying search experience to benefit both consumers and advertisers. Yahoo! will also become the exclusive sales force for paid advertising, and it will manage the relationships with both companies’ premium advertisers.

The general consensus seems to be that advertisers will undoubtedly benefit from the deal in terms of organic listings because advertisers only need to optimize for one engine (Bing) to appear on both. The effect on paid-search advertisers remains to be seen. Will there be a 2-for-1 deal, or will the increased volume of search queries (with the combination of the two engines) lead to an increase in paid-search costs? What if you only want to place search ads on one of the engines? These concerns will be hashed out in due time as Yahoo! works closely with high-volume advertisers, agencies and resellers (and Bing with self-service advertisers) to get the ball rolling on the transition.

It is still going to be awhile before we see the actual transition of Bing’s organic content and Yahoo!’s paid content powering both sites. In fact, Microhoo’s goal is to complete the transition in the U.S. by the end of 2010, just in time for the holidays.