Google Boots Yahoo Ad Deal
Remember the back-hand Yahoo’s CEO Jerry Yang laid across the face of Microsoft’s CEO Steve Ballmer when Ballmer offered to buy Yahoo? Yang made it clear that he would rather join the enemy (team up with Google) than make a deal with Ballmer.
Well, it seems that Yang’s plans have now gone awry.
Yang now says: “To this day, I have to say that the best thing for Microsoft to do is to buy Yahoo.”
CNET News:
Bowing to federal regulators’ antitrust concerns, Google pulled the plug on a search-ad partnership with Yahoo that would have given the latter major new revenue.
“After four months of review, including discussions of various possible changes to the agreement, it’s clear that government regulators and some advertisers continue to have concerns about the agreement,” David Drummond, Google’s chief legal officer, said in a blog post Wednesday.
The 10-year deal would have placed Google ads on some Yahoo search results, and the companies would have shared resulting revenue. The deal would have let Yahoo show ads on pages where its own technology, called Panama, wasn’t able to provide results, the company said.
In some ways, the Justice Department’s decision was not terribly surprising. Over the past two or three weeks, federal antitrust regulators became increasingly wary of the agreement and, in particular, tested Google’s resolve to remain in the deal, according to sources. Over the past few weeks, the give-and-take of negotiations between the parties began to falter as government regulators became increasingly unyielding in their demands.
Regulators, at one point two or three weeks ago, told Google that if the government pursued a lawsuit to block the deal, it would consider adding a monopolization count against Google to the complaint, which in essence would allege the search giant of using monopoly power in a relevant market. Apparently that hit a nerve with the search giant, noted a source, and it became evident to regulators that Google’s resolve to fight a legal battle was wavering when faced with the prospect of a monopolist label and all the regulatory oversight that could come with it.
Now that Google has given Yahoo the boot, is Yahoo CEO Jerry Yang getting eager to make a deal? Yang appears to be leaving the door very much open for an old suitor: Microsoft.
During a moderated “conversation” at the Web 2.0 conference in San Francisco, Yang said late Wednesday, “To this day, I have to say that the best thing for Microsoft to do is to buy Yahoo. I don’t think that is a bad idea at all…”
But over at Microsoft, the bombastic Ballmer has changed his tune as well. He responded to reporter’s questions with:
“We made an offer, we made another offer, and it was clear that Yahoo didn’t want to sell the business to us and we moved on,” Ballmer said. “We are not interested in going back and re-looking at an acquisition. I don’t know why they would be either, frankly. They turned us down at $33 a share.”
The public posturing probably means they’re in serious negotiations.
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"Google Boots Yahoo Ad Deal"
