Microsoft, Yahoo! attempt to head off legal action

Microsoft has confirmed that it is engaged in informal talks with European regulators to deal with competition concerns over its search deal with Yahoo!

The 10-year agreement is also being investigated by the US Department of Justice, which recently made a second request for information to the two firms.

"As we said when the agreement was announced, we anticipated that this deal will be closely reviewed in the United States and EU, and discussions in both geographies continue. We remain hopeful the deal will close in early 2010.", a spokesman told Reuters.

The Competition Commission concerns seem to be a long way from either a formal or informal investigation and it would be standard practise for the companies involved to inform eurocrats of some of the details of a deal of this size.

Microsoft has claimed the deal is pro-competitive in that the combined search will offer a more robust alternative to the market dominance of Google. Google is no doubt doing its best to persuade Brussels and Washington of the opposite view, so maybe Microsoft is just getting its retaliation in first. ®