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Googling an Antitrust Deal

Yahoo and Google are said to be in talks with Justice.
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The search-advertising alliance between Yahoo and Google always seemed to be something of a Hail Mary pass.

How could regulators approve a deal that involves 90 percent of the market? Not only is Microsoft adamantly opposed, but a number of other companies have also come out against the deal.

It's not surprising to learn that Google and Yahoo are in talks with the Justice Department in an effort to stave off an antitrust lawsuit.

John Wilke of the Wall Street Journal reports that the talks are in the early stages. He says that concessions being discussed 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."

Michael Arrington of TechCruch says that the idea of a volume cap is the most compelling, as it helps lessen the incentive to neglect its own product in favor of Google.

"A cap means Yahoo can only rely on Google to a point, and if the cap is small enough, then Yahoo will be forced to continue to invest in their own search business," he says.

Yahoo is no doubt keen to make concessions in its quest to stay independent. At what point does it stop making sense to Google?


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