American Antitrust Institute Eyes Google-Yahoo Deal

    September 24, 2008

A group called the American Antitrust Institute is probably the last thing Google or Yahoo wanted sticking its nose into their search deal.  Now the AAI has done so, though, and surprisingly, it doesn’t see the partnership as a completely objectionable proposal.

The AAI is instead looking to reshape the deal so that the "pro-competitive benefits" are strengthened.  The group outlined four suggestions in a formal statement.

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First, it wants Yahoo to refrain from using Google’s ads outside North America or on any third-party sites.  Second, minimum bid or reserve prices are to be considered forbidden.  Yahoo also isn’t supposed to use Google’s ads when, in terms of filling space around a search result, the company already has enough of its own, and Yahoo shouldn’t receive extra revenue when it uses Google’s ads.

Since Google and Yahoo have tended to ignore all criticism of their deal, it’s hard to say whether they’ll embrace any of the AAI’s recommendations.  The companies can hardly view the AAI’s constructive criticism as a non-objection, either, since it stated, "[T]he transaction should be viewed as presumptively anticompetitive."

Still, if federal regulators pay attention, the AAI may have found a compromise that all parties will have to live with, and as group after group voices its objections to the deal, it’s looking increasingly likely that some sort of block or regulation will take place.