Yahoo-Google deal doomed? No, they insist

The Deal reports that the search-ad partnership is falling victim to antitrust obstacles. Yahoo and Google say discussions continue, though.

Resistance from antitrust regulators has doomed Yahoo's search-ad deal with Google , The Deal has reported, but the companies emphatically say discussions are continuing.

"A proposed joint venture between rival Internet companies Google and Yahoo appears headed for the trash bin, just ahead of an expected U.S. Department of Justice challenge to the agreement, lawyers close to the deal said," according to a Silicon Alley Insider quote of the story. "The DOJ could file a complaint seeking a preliminary injunction on the agreement even as the parties assess their options. Antitrust lawyers said the government would have to clear a high hurdle to win a preliminary injunction. But it is even less likely that Google and Yahoo would want to battle the government in court over such a controversial deal, particularly while the financial market is so precarious, the lawyer said."

Yahoo and Google have twice extended their deadline to wrap up the deal , under which Yahoo would show Google's search ads in some cases and bring in $800 million in new Yahoo revenue in its first deal. But the companies said Tuesday that they're still working on making it a reality.

"We are continuing to have cooperative discussions with the Department of Justice about this arrangement and agreed to a brief delay in implementing the agreement while those discussions continue. We are confident that the arrangement is beneficial to competition, but we are not going to discuss the details of the process," Google said in a statement.

Yahoo was on the same page: "The companies agreed to a brief delay in implementing this agreement to continue our ongoing discussions with the Department of Justice. We are continuing those discussions with regulators and look forward to responding to their questions about this agreement. We believe strongly that this agreement will strengthen Yahoo's competitive position in online advertising and will help to drive a more robust, higher quality Yahoo marketplace for our advertisers, publishers, and users."

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About the author

Stephen Shankland has been a reporter at CNET since 1998 and covers browsers, Web development, digital photography and new technology. In the past he has been CNET's beat reporter for Google, Yahoo, Linux, open-source software, servers and supercomputers. He has a soft spot in his heart for standards groups and I/O interfaces.

 

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