Would Yahoo Hand Over Its Paid Search Business To Google?

from the wouldn't-that-be-something? dept

Fri, Aug 10th 2007 9:23am — Mike Masnick

With Yahoo and Google considered such big rivals these days, many people forget that they were originally partners. For many years, Google provided the search engine that powered Yahoo, while Yahoo focused on all of the various other properties it had. It was only way too late that Yahoo realized just how much money Google was pulling in via paid search and went on a buying spree to buy up nearly every other serious player in both the paid search and search technology business. However, stringing together all of those businesses was a lot more difficult than Yahoo expected, and it only gave more time for Google to run away with its lead in the space. Only recently did Yahoo come up for air and realize how far off course things had gone. The company jettissoned CEO Terry Semel in favor of founder Jerry Yang, who's now apparently considering all possible options. According to Kara Swisher, that includes giving up in paid search and partnering with Google again, though, this time for paid search and not just pure search. Apparently, despite the rivalry, executives from the two companies talk quite often and have even sketched out how such a relationship might work. It's probably a long way from reaching that point, but it's probably going to look more and more appealing. Yahoo is spending a ton of money just to catch up and tread water, while Google would let them save a lot while potentially allowing them to earn a lot more as well. It may hurt their pride, but it's probably the right move.

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Filed Under: paid search
Companies: google, yahoo

14 Comments

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Unknowledgeable Geek, 10 Aug 2007 @ 9:54am

I am sure the gov't would shut down that merger. I don't see how that wouldn't be considered a Monopoly.
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- Vincent Clement (profile), 10 Aug 2007 @ 6:55pm
  
  Re:
  Your name suits you.
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AJax, 10 Aug 2007 @ 10:04am

Its not a monopoly for the fact that there are still plenty of other search engines out there. They would simply be the biggest and more than likely most successful of them.
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powerkor, 10 Aug 2007 @ 10:05am

There's still other choices for paid search, I don't think the gov. will stop them from doing business together. They may try to get a cut, but ultimately, I don't think the term Monopoly applies here.
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Anonymous Coward, 10 Aug 2007 @ 10:31am

Its not a merger Unknowledgable Geek... its a business arrangement between two companies
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Ordinator, 10 Aug 2007 @ 10:35am

Nobody ever said "Merge"
This is not talking about Yahoo and Google merging into one company, this is talking about Yahoo and Google partnering to help better the profits of each company individually. "Monopoly" is not even applicable since this isn't a merger. They would still be two seperate companies, each with their own stock and CEOs and profits; they would just be working together on some apsects so that both companies can end up making more money.
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Evil Supreme, 10 Aug 2007 @ 10:37am

Wow talk about doing evil. Yhoo and Goog would control 75%+ of the search market place in the U.S. and nearly 90%+ in parts of the global market. At that rate Goog would be able to dictate nearly everything you see on the Internet. And if they decided Oil companies shouldn't advertise since they are adding to the "whatever google wants to support for the day" cause, then bye-bye ads globally.

Don't forget google has doubleclick AND radio and newspaper ads.

George Orwell would be proud. Except its wasnt the Government it was the other G.
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Kevin, 10 Aug 2007 @ 11:19am

Stop it
This isn't a merger.

It isn't.

There will be no resulting company that control 75%+ of the search market in the US. There would still be two totally separate companies who together control 75%+ of the search market.

They will be separate.

They will not merge.

Nothing will change with regards to marketshre.

Yahoo isn't even talking about outsourcing their search to Google. They're talking about outsourcing paid search to Google.

It's not the same thing.

There is no merger.

They will be separate companies.

Get it?
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- Anonymous Coward, 10 Aug 2007 @ 2:24pm
  
  Re: Stop it
  Wait, hold on. What are you trying to say?
  
  ;)
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- Charles Griswold, 11 Aug 2007 @ 7:11pm
  
  Re: Stop it
  There is no merger.
  
  They will be separate companies.
  
  Get it?
  Well, crap. There goes my devious plan to cybersquat on goohoo.com.
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  - Charles Griswold, 11 Aug 2007 @ 7:13pm
    
    Re: Re: Stop it
    Well, crap. There goes my devious plan to cybersquat on goohoo.com.
    Double crap. It's already taken.
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Andrew Pass, 11 Aug 2007 @ 2:38pm

Yahoo and Google
I find that idea pretty incredible. But, the government would almost certainly have to approve such a deal and I'm not sure that it would do so. It would smack of search monopoly. Check out my living textbook: http://www.pass-ed.com/Living-Textbook.html
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blah, 11 Aug 2007 @ 10:47pm

yahoo search will have to become a google clone
if this takes place, it does undercut any impetus at yahoo to differentiate its search results dramatically from google's, as this my impact revenues negatively given the relationship between ad spending and search performance.

translation: people buying google search ads are buying ads based on their perceptions of how google search works. a search engine that produces different results essentially undermines this and derives less revenue than google.

so an earlier poster is probably right - google will be deciding what the world sees.
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Lou, 18 Aug 2007 @ 11:06am

Sponsored Search - Not Search
First I've heard of this, but sounds like they are only talking about Sponsored Search...nothing to do with organic search results. Just paid placement. No idea how that would work though.
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