Yahoo Explains Tie-up With Google

Blaise Zerega lives in the Golden State. On the heels of yesterday's news that California was joining other states in scrutinizing the anti-trust implications of the recent Yahoo-Google ad partnership, Yahoo executive president Hilary Schneider this morning explained how the tie-up will benefit users -- without explicitly acknowledging the potential legal problems of the deal.

(Disclosure: Schneider was formerly CEO of Red Herring where I worked "back in the day.")

Addressing the press corps during a media briefing, Schneider began, "Let's talk a little bit about Google." She provided a bit of background on the arrangement, summarizing it as "Allowing Google to sell against our audience where it makes sense for Yahoo."

Taking the example of search query: "red roses in Birmingham Alabama," Schneider showed that the Yahoo results page returned zero right-hand rail text advertisements. Performing the same search query on Google, however, results in 11 right-hand rail text advertisements. Under the partnership, presumably, Yahoo users looking for roses in Birmingham would then be served the same 11 text ads.

"it's about delivering the most complete set of results against that search query," concluded Schneider.

And she's right. As a user, I personally find text ads incredibly useful, often more relevant than search results themselves.

The state attorneys-general looking into this Yahoo-Google arrangement are focused on how large a combined market share the two giants will have -- perhaps 90%, and ignoring the benefit the arrangement confers on consumers  -- like me.

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