Google and Yahoo, who have been waging a multiple-front PR war to convince people that their search pact isn’t an antitrust problem, are making some progress in the most important battle: Convincing the Justice Department. WSJ:
In the settlement talks with the government, both companies have discussed concessions. These include capping the volume of Google ads Yahoo would use, assurances that Yahoo would continue to compete in search ads, and a reporting mechanism to ensure compliance, people close to the talks said. U.S. officials hope to impose measures that will ensure that prices advertisers must pay don’t rise significantly after the deal.
…Reworking the deal to include a reporting mechanism could require the companies to disclose more about the mechanics of their closely-guarded search-advertising technology than they want to. And caps on how many Google-sold ads Yahoo can display could limit Yahoo’s financial gains from the agreement.
…If the companies reach a settlement with regulators, its principles would likely be laid out in a consent decree that would be filed in court.
While that would allow the deal to proceed, it would also be a formal recognition of Google’s market power. That could constrain the Mountain View, Calif., company’s conduct in the future and might draw private antitrust suits from competitors or advertisers.
Even as senior Justice Department officials weigh the companies’ proposals to resolve antitrust issues, its trial staff continues to prepare a lawsuit to block the deal, according to lawyers and executives contacted by the government.
Based on the Journal’s reporting, it doesn’t appear as if Google and Yahoo are actually putting that much on the table, but some of that would be in the details; we don’t expect either company to agree to a significant volume cap, for instance. In the meantime, we’re hoping someone can explain one nagging question we’ve never had answered: Why, at the end of a lame-duck presidency that hasn’t shown an interest in antitrust issues for 8 years, is Justice interested in an Internet search deal?
See Also: SEC Lets Yahoo Keep Mum On Google Deal
Senate Raises An Eyebrow At Google-Yahoo Deal, But Waves It Through
Google: Our Yahoo Deal Won’t Raise Search Ad Prices (That Much)
EU Investigating Google-Yahoo Search Deal
Former Fed Regulator: Litvack Hire Means DOJ Likely To Litigate To Stop Google-Yahoo Ad Deal
Advertisers Terrified Of Google-Yahoo Search Deal