Senate To Keep A Watchful Eye On Google-Yahoo Deal
Senate Judiciary Antitrust Subcommittee Chairman Herb Kohl, D-Wis., is going to keep a close eye on Google's newly announced deal with rival Yahoo, the lawmaker said in a Thursday statement. Several months ago, Kohl also pledged to watch over a proposed deal between Yahoo and Microsoft, which eventually soured.
"This collaboration between two technology giants and direct competitors for Internet advertising and search services raises important competition concerns," he said. "The consequences for advertisers and consumers could be far-reaching and warrant careful review, and we plan to investigate the competitive and privacy implications of this deal."
Google Vice President Omid Kordestani posted a message on Google's corporate blog saying that the Web giant was entering into a non-exclusive advertising agreement that will provide Yahoo with access to Google's AdSense for search and AdSense for content platforms on their U.S. and Canadian Web properties.
The deal comes as the Senate Commerce Committee plans to hold a hearing on the privacy implications of online advertising next week. Witnesses are expected to focus on the key factors driving online behavioral advertising, the methods of online behavioral advertising employed by industry, and the protections the FTC and FCC should adopt to protect consumers from unwanted or unnecessary invasions of privacy.
Kordestani said consumers will see more relevant ads when they are looking for information and browsing the Web and will benefit from interoperability between instant messaging services. Publishers currently working with Yahoo will benefit from Google's ad technology, potentially increasing the revenue they earn from their sites, he said. Advertisers will have new ways to reach their target customers online more efficiently.
He also said the pairing will be good for the marketplace. "The truth is, this kind of arrangement is commonplace in many industries, and it doesn't foreclose robust competition," Kordestani said. Toyota sells its hybrid technology to General Motors and Canon provides laser printer engines for Hewlett-Packard, he noted.
Yahoo CEO Jerry Yang said he believed the convergence of search and display "is the next major development in the evolution of the rapidly changing online advertising industry" and the Google deal "represents an important next step in our open strategy, building on the progress we have already made in advancing a more open marketplace."
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