It’s always odd to see rivals working together, but in at least one case, that strangeness could cease to exist; Ask and Google may not renew an ad deal that will expire in less than four months.
Ask-Google Ad Deal Could Expire
Four months isn’t too short a time, of course; as any writer can tell you, a lot can be accomplished in just a twelve-hour period, so long as there’s plenty of coffee on hand. But considering that Barry Diller, chairman and CEO of IAC, once thought the partnership would be renewed by April, things don’t look good.
Ask might take a major hit if it and Google break up; according to Pete Barlas, Mountain View has been quite generous in terms of revenue-sharing. Google, on the other hand, would see a very minor drop if the deal implodes; not much looks significant in the face of a $194 billion market cap.
How, then, could Ask have an interest in letting the deal expire? For the same reason people agree to adjustable rate mortgages – a need to get or save cash quickly. Microsoft might try to sweep Ask away with what would effectively be a large signing bonus, followed by worse terms per ad unit than what Google had offered.
We’ve seen how those adjustable mortgages worked out for the housing market, though, and analysts are inclined to believe Ask might also get into trouble by accepting this sort of deal.
