Google! Yahoo! looking! doubtful!

Microsoft back in the frame?

By John Oates • Get more from this author

Posted in Law, 31st October 2008 13:38 GMT

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Google is considering walking away from its advertising deal with Yahoo! because the Department of Justice is demanding too much in return.

The deal is currently on hold while it is assessed by the DoJ. Lawyers there have proposed some kind of reporting system to keep an eye on what prices the two would charge customers.

Other suggestions from the lawyers include a cap on how many Google ads Yahoo! could serve or a promise that Yahoo! would remain a competitor for Google's in the search ad business.

Lobbying on all sides has been fierce, so the latest leaks could just be tough haggling. But anonymous sources in the Wall Street Journal reckon Google could pull the plug on talks next week. Google told the paper discussions were still going on.

Of course there is also the issue of the US election to consider.

If the deal did fall through it is possible that Microsoft would lumber back into action. Hindsight is a wonderful thing of course - but Yahoo's rejection of a $33 a share offer doesn't look so bright now that its shares are changing hands for just under $13.

Russian regulators took a tough line with Google's attempted land grab there. Google offered $140m for the online ad business of Russian search engine Rambler Media but Russia's Federal Anti-monopoly Service blocked the deal, citing competition concerns. ®

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