Google Senior Vice President of Corporate Development David Drummond announced, in the company’s Public Policy Blog yesterday, that the on-again, off-again deal with Yahoo! which would have seen the two Internet giants cooperate on search and advertising, is definitely off:

“In June we announced an advertising agreement with Yahoo! that gave Yahoo! the option of using Google to provide ads on its websites (and its publisher partners’ sites) in the U.S. and Canada. At the same time, both companies agreed to delay implementation of the agreement to give regulators the chance to review it. While this wasn’t legally necessary, we thought it was the right thing to do because Google and Yahoo! have been successful in online advertising and we realized that any cooperation between us would attract attention.”

And, when Google’s lawyers looked deeper into the plan, they warned that the deal might trigger a lengthy anti-trust battle with U.S. federal regulators:

“…It’s clear that government regulators and some advertisers continue to have concerns about the agreement. Pressing ahead risked not only a protracted legal battle but also damage to relationships with valued partners. That wouldn’t have been in the long term interests of Google or our users, so we have decided to end the agreement.”

Drummond expressed disappointment that a deal with such great potential for both parties promised to be more trouble than it was worth.

Leave a Reply