Business Insider
Here's what Apple's Weather app looks like powered by Yahoo (left) versus The Weather Channel (right).
But according to a new report from Kara Swisher of Re/code, losing its premium placement on the iPhone is actually a bigger loss for Yahoo than originally thought.
"Yahoo had been renting ocean-front property for years and did not realize the lease was up and the Weather Channel slipped right in and took it," one Yahoo executive told Re/code, adding the company acted too late to save the deal. "It's a high-profile loss."
Exchanging Yahoo for The Weather Channel made a great deal of sense for Apple: The Yahoo Weather app is actually powered by The Weather Channel - specifically, its Weather Underground service - so in a way, Apple was simply cutting out the middle man. According to Re/code, Weather Channel CEO David Kenny convinced Apple to close the deal after it added more technology and information it didn't provide to Yahoo, including a summary of weather conditions and a nine-day forecast.
Of course, there's no way to calculate the loss to Yahoo, having lost such an important piece of Apple's mobile real estate. But many of Yahoo's 400 million monthly active users come from deals with smartphone makers - not because they make money (these deals don't include ads), but because they send traffic back to Yahoo's various properties.
In other words, losing this important source of traffic could have deep, longstanding impacts on Yahoo's other properties, and thus, its bottom line.
Though its weather deal can't be salvaged, Yahoo CEO Marissa Mayer is reportedly trying to convince Apple to replace Bing as the default search engine in its mobile Safari web browser with Yahoo Search, although those efforts might prove unsuccessful since the company already has a search partnership with one of Apple's key rivals: Microsoft.