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I didn’t attend the Senate or House hearings regarding the Google Yahoo scrutiny yesterday, but when I blogged about it based on my colleague’s reporting, I expressed concern that the government officials, though not necessarily Luddites, were perhaps not the best judges of modern seach and online ad deals.
Today I was pleased to see that Kara Swisher, who did attend the hearings, has the same concerns. Though she, unlike me, is not in favor of the Googlehoo union.
Look Kara, in a perfect world, it would be great for Yahoo to stand on its own, but with Icahn and Microsoft breathing down its neck, I choose to think the Google deal gives it some succor. But I digress.
Kara noted that things got interesting when Microsoft General Counsel Brad Smith alleged Yahoo CEO Jerry Yang told Microsoft executives during a June 8 meeting at the San Jose airport that a Yahoo-Google alliance would effectively dominate the Internet search business.
In short, Smith was saying Yang made Microsoft’s argument that the Googlehoo union would be anticompetitive at that meeting. Of course, Yahoo General Counsel Michael Callahan said he didn’t recall Yang making those comments. Sen. Arlen Specter, R-Pa., wanted to know who was telling the truth.
I wonder, too. And if Smith is telling tall tales, what is the value in that? Is it just to plant the seed that Yahoo supposedly confirmed the anticompetitive nature of the deal, regardless if it is a falsity?
Could be a good strategic move, or one that blows up in his face. Either way, Microsoft won’t lose much.
The Department of Justice, which is scrutinizing the deal, is the group to win over. No offense to the Senate, but the DOJ has litigators who more closely look at these deals and can analyze the competitive comparisons and disparities.
What concerns me is that we have seasoned politicians who aren’t qualified to comment on search and online advertising weighing in and shouting things like, “What about privacy?!” (That would be Sen. Patrick J. Leahy, chairman of the Senate Judiciary Committee).
Privacy isn’t the main issue here; Yahoo promised to anonymize any data it passed to Google. It would be better if the politicians focused on the competitive nature of the deal, which is a tough argument to make.
I mean, Google and Yahoo together are not good for Microsoft, so Microsoft can make that case. But will Google cancel out Yahoo in the process? That’s the greater, tougher question that bears answering.