Microsoft Corp. and Yahoo Inc. have signed off on their plan to team up against Google Inc. in the lucrative Internet search market. The step announced Friday seals the terms of a preliminary agreement announced in late July. The companies hope to implement the deal next year with the approval of anti-trust regulators.

“Yahoo! and Microsoft welcome the broad support the deal has received from key players in the advertising industry and remain hopeful that the closing of the transaction can occur in early 2010,” the companies said in a joint statement.

“Microsoft and Yahoo! believe that this deal will create a sustainable and more compelling alternative in search that can provide consumers, advertisers and publishers real choice, better value and more innovation.”

The arrangement for the 10-year Web search and advertising deal was made public in July. Yahoo is promoting Microsoft’s Bing search engine on their sites while Yahoo Is giving the limited global sales for first-class search advertisers. Microsoft’s partnership with Yahoo allows the companies a bigger chunk of the Web search market, but analysts are not in agreement on if the deal will in fact damage search juggernaut Google.

Google is the undisputed champion in the ongoing Web search battle that research company Forrester guesses will increase to 30 billion dollars in 2014.

Forrester analyst Rebecca Jennings is predicting, “This deal should help convince even the most stubborn budget-holder that spreading their money outside of Google would be beneficial. This will create a more viable second-string player in all markets, giving interactive marketers a significant, credible alternative/additional outlet for their search spend.”