It took Yahoo many months to create the new model, effectively rebuilding the system it acquired with the $1.6 billion purchase of Overture Services. Although Panama is just getting off the ground, there's reason to believe this time in the pit has done Yahoo good.

Yahoo faced a difficult decision: Continue with its current advertising model and watch as it lost ground to Google, or rebuild the platform from the ground up. Yahoo hesitated, stuck with the original game plan, and watched Google AdWords become a huge success

Not only did advertisers prefer a model that rewarded them for creating better quality ads by effectively reducing the amount per click needed to achieve the top spot, but Google's bottom line benefited greatly because its platform always selected the ads that generated the highest return, thereby increasing the search engine's earnings per search.

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