Advertisers Ask DOJ to Bless Microsoft-Yahoo Search Deal to Challenge Google

By Clint Boulton  |  Posted 2009-10-20 Print this article Print

When Microsoft and Yahoo announced their intent to partner on search July 29, they spawned a "boatload" of coverage, to borrow a word Yahoo CEO Carol Bartz used infamously to characterize the money it would require to buy or do a deal for Yahoo's search.

Microsoft and Yahoo made their bid, a 10-year-deal in which Microsoft's Bing search engine would pay to power Yahoo's search, combining for nearly 30 percent of the search market and closing the gap on Google's 65 percent share. The Department of Justice is scrutinizing the deal.

Microsoft CEO Steve Ballmer and Bartz, accompanied by their legal counsel, teamed up in person to unveil the deal in an hour-plus-long conference call with reporters. We, the media, devoured it for a few weeks. The Microhoo front had quieted. Until today.

The Association of National Advertisers Oct. 19 filed a brief open letter pledging its support for the bid and asking the DOJ to swiftly bless it because it's good for the online advertising market.

It's so brief, I have no problem cutting and pasting it in full for you here:

Advertising is the fuel that powers the Internet. Most Web sites depend on online advertising to survive - it's what allows them to offer consumers free content and services.

A very important form of online advertising is search advertising - the sponsored links that appear when a search engine answers a query. A healthy, competitive market for search and search advertising is crucial to the Internet's future.

We believe that Yahoo! and Microsoft's proposal to combine their technologies and search platforms is good for advertisers, marketing services agencies, website publishers and consumers.

These benefits are too important to wait for. As leading members of the advertising and marketing services industry, we urge the Department of Justice to bring its antitrust review to a speedy conclusion. This proposal enhances competition, and should be allowed to take effect as soon as possible.

The letter was signed by AAAA President and CEO Nancy Hill, along with the leaders of the four major advertising holding companies: Publicis Groupe, WPP, Interpubic Group of Companies and Omnicom Group.

That's one hell of a ringing endorsement for the Microhoo deal, especially when you consider these parties demanded the DOJ deny Google and Yahoo their own paid search arrangement in June 2008.

The DOJ struck down the Google-Yahoo bid with prejudice. I expect the AAAA's letter will merit serious consideration by the DOJ. This is a wise group that harbors no illusions about the power Google has wrestled in their market.

If Microhoo only narrows the gap by less than half, it still won't level the playing field in paid search, of which Google owns 70 percent. At least it shows Microsoft is willing to challenge Google where it is Goliath.

The AAAA would be grateful for any reprieve. |

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