News Report #3

Copyright 2008 Reuters
August 29, 2008
http://www.internetnews.com/breakingnews/article.php/3768571/Google+Yahoo+Deal+On+Track+Despite+Scrutiny.htm


Google and Yahoo, two of the biggest Internet search markets, are apparently coming together with an agreement that will be an advertising partnership. According to a boomerang report, Goodle and Yahoo will proceed with the agreement by early October, despite government officials questioning. Google's Eric Schmidt says that they plan to move forward with the proposal and they are talking to the government about the process. Google has more than 60 percent of the Internet search market and Yahoo has almost 17 percent. In June the advertising partnership was decided which would allow Google to put search ads on Yahoo's site. Little has been disclosed about how the deal is structured and how the payment plans might operate. However in a recent Security and Exchange Commission fling, Google has been said to compensate Yahoo with an undisclosed percentage of its ads each month. Google may cancel the deal if gross revenue for four months drops below $83 million. This deal has raised concerns that it will give Google too much power in the online advertising market. The U.S. Justice Department launched a formal antitrust investigation earlier and attorney generals have also opened inquiries about the matter. Microsoft has also raised the issue of consumer privacy warning that the two Internet giants of their consumer data.
I think that Google and Yahoo are big enough on their own that there is no need for a joint advertising partnership. They should stay separate and hold their own to prevent confusion and more concerns from consumers and users. I don't know that much about the Internet revenues and advertising so it is hard for me to see the true benefits or consequences of this partnership but I think it sounds like a mess. However it could always lead to better relationships within the Internet market.