A couple weeks ago, Google said it would go forward with its proposed deal with Yahoo!, which would see Google supplying ads to Yahoo!, if the U.S. Department of Justice had not yet blocked them from doing so. In other words, they aren’t gong to wait for an investigation to play out before they begin.
So far, Google and Yahoo! are still planning on kicking this deal into gear in October. However, the odds that they will be able to do so may have just gotten slimmer. Now the World Association of Newspapers (WAN) has asked not only the U.S. Department of Justice, but also the European Commission and the Competition Bureau of Canada to block the deal, according to paidContent.org, who got some quotes from WAN’s president:
“Competition forces each company to offer the best possible terms and helps ensure that newspapers earn a fair market return for the right to display ads and search boxes on their sites. The proposed advertising deal between Google and Yahoo would seriously weaken that competition, resulting in less revenues and higher prices for our members.”
“WAN is also concerned that this deal would give Google unwarranted market power over important segments of online advertising. Advertisers will increasingly migrate to Google since they will see diminishing price advantages to advertising through Yahoo. Google has refused to allow Yahoo to show Google ads on the websites of new publishing partners it acquires after the deal is finalized – in other words, Google has imposed a condition that impedes one of Yahoo’s last remaining opportunities to compete with Google. What this means for newspapers is that Yahoo’s bids for their ad business will almost certainly be lower than they are today.”
Microsoft, who is all too familiar with antitrust issues itself, must be thrilled that WAN has stepped up to fight this deal. The company probably has some leftover bitter feelings about not being able to reach a deal with Yahoo! itself, but if the Google-Yahoo! deal comes to fruition, Microsoft is likely to face as much fallout from it as anyone.
Like Stan Schroeder at Mashable says, “This is pretty much along the lines with what Microsoft’s been saying about this deal, and they’re likely to support WAN on this one, so Google and Yahoo now have some very strong opposition working against them.”
So far, it is unclear what steps the Justice Department, the European Commission, or the Competition Bureau of Canada will take. September is already about half over, and October will be here before we know it. Will Google and Yahoo! get their deal kicked off or will the game be delayed for a booth review? If it falls through, Google will still be doing well on the advertising field. It might spell something different for Yahoo!.
