 |
A US Senate subcommittee heard testimony today about the competitive implications of Yahoo’s recent deal with Google, which will see the company mix ads supplied by Google with its own on search result pages. In addition to two individuals who currently purchase search advertising, the hearings featured testimony from senior executives from the two principals involved in the deal, as well as Microsoft’s top lawyer, Brad Smith.
Their testimony presented radically different pictures of what constitutes competition in the search market, how this deal will affect that competition, and the ongoing negotiations between Microsoft and Yahoo.
The chairman of the Subcommittee on Antitrust, Competition Policy, and Consumer Rights, Herb Kohl (D-WI), opened the hearing by noting that Yahoo and Google combined control over 90 percent of the search market, and he raised the concern that the deal would “reduce Yahoo to nothing more than the latest satellite in Google’s orbit.”
It’s impossible to tell how this deal will affect competition in this arena without knowing how search prices respond to an altered market, and whether Yahoo actually does invest the added revenue, rather than using it to polish its bottom line. As a result, some of the more interesting aspects of the hearing came when the witnesses were put on the spot during questioning.
The Senate is unlikely to act in any way to block the Google/Yahoo deal, but it does have the ability to influence public perception, which can affect the response of regulatory agencies like the Federal Trade Commission. As such, the testimony was largely a platform for Microsoft to highlight aspects of the deal that should leave regulators troubled, while Yahoo and Google got the chance to push regulators to let the agreement sail through without restrictions.
Based on these goals, it didn’t appear that either side landed a knockout blow, but the circus isn’t over yet. Instead, it’s packing up all three rings and heading over to the House for a similar hearing on a similar issue this afternoon.
Bill Gates is retiring just when things are getting interesting. The Senate is unlikely to act? 90% of online search ads for a company that knows everything you search for — are we missing something here?
Yahoogle?? I think they should call it Googoo!
Gee… Is the pot calling the kettle black?
http://marketshare.hitslink.com/report.aspx?qprid=8
jaleous?
Perhaps M$ should give out an ad-sponsored version of their operating system?
Maybe Congress should consider 90% to be a number of big significance and put a probe up Microsoft’s butt again for Windows and MS Office.
It’s the nice way to say they’ve been paid off.
Very revealing. Searching the ‘net is one of the most fundamental clicks for users, yet no one here seems concerned that 90% of of the ads might be approved, targeted and published by one entity who knows more about your web usage than anyone else in the universe.
Gotta love this crowd. I’ll wager Cinaedh and Misanthropic Scott will show up.
Aw, poor little microsoft. Having to deal with totally unfair business practices. They have a right to complain, how are they going to be able to compete if yahoo and google won’t let them. Monopolies are bad for the free market, M$ should know all about that by now. In the end it’s survival of the fitest, big fish eats the little one, etc… It’s nice to watch them squirm, they’ve been doing alot of it since the Vista flop.
#1, Googoo? Maybe you meant Goohoo.