Yahoo Should Team With Google

A MSN/Yahoo deal doesn’t make much sense. Google and Yahoo makes more sense, although that wouldn’t be ideal for search marketers, as that would not leave us with much leverage.

We’re going to claim ownership of this idea: that the right partner for Yahoo isn’t Microsoft, but Google. A JP Morgan analyst, cited in Barron’s, estimates that Google’s more liquid exchange for text ads, if brought to bear on Yahoo’s search results, could add more than $1bn to the Sunnyvale internet company’s 2008 earnings. That would create more value than any other possible deal for Terry Semel’s lumbering internet portal.

Barron’s Eric Savitz thinks the deal could get past the anti-trust authorities, because a combination of the two biggest internet media companies would still have only 4% of the US advertising market, if one includes both online and traditional media.

Valleywag’s idea, first floated in January: just do a long-term deal to bring in Yahoo’s search engine as an affiliate of Google’s Adwords search marketing business, which would be less obviously monopolistic, as well as less convoluted; and do a deal soon, before the government wakes up to the fact that Google will soon be way more powerful than Microsoft.

  1. detoamdetoam05-07-2007

    I am inclined to strongly disagree. While it does make sense economically for Yahoo and Google to join forces, I do believe and as You have pointed out it will be a disaster for small and new webmasters. They will have virtually no competition in site. That means that it actually will be a monopoly. Google as it is control pretty much the level of income a webmaster is allowed to earn because of the PR.
    I, however, do not like the Idea of MS buying the Yahoo as well. While I am supporting the Microsofts claim that did not in fact create a monopoly (I would explain myself, but it would take a few pages) and I do support their tactics in business (business is business) I do think that another lawsuit against Microsoft would be more pain for the rest of us as the last one was. It obviously did not hurt them a little bit. Simply put I hope the so-called merger will be stopped.

    Note to editor: please edit as You like. English is not my first language.

  2. bilgibilgi05-08-2007

    i dont agree with this idea. G and Y are like enemies. They are in a big and big race. The name of the race is contolling the internet

  3. Peter Da VanzoPeter Da Vanzo05-08-2007

    “While it does make sense economically for Yahoo and Google to join forces, I do believe and as You have pointed out it will be a disaster for small and new webmasters.”

    Right.

    But Google don’t care if such a move is good or bad for webmasters. Their consideration would be how much market share they could grab, and at what cost.

    Also, such a move would be defensive. They’d buy it simply to stop MS doing so, thus making MS job very difficult indeed.

    The problem is, of course, Yahoo would be a very expensive acquisition.

  4. pjypjy05-09-2007

    Taking the Valleywag suggestion sideways, wouldn’t it be more advantageous and profitable if Google were to buy 51% (or all 100%) of Yahoo’s Pay Per Click product.

    This would increase the visibility of Yahoo to average Joe searcher due to Googles interest/investment, therefore create a healthy market for all involved.

    That is unless Google decided to remove the competition by voting with its 51% to delete paid advertising on Yahoo.

  5. Peter Da VanzoPeter Da Vanzo05-09-2007

    “remove the competition by voting with its 51% to delete paid advertising on Yahoo”

    Heh heh….

  6. TechDukeTechDuke05-27-2007

    Webmaster needs more baskets to put their eggs. It will be disaster for webmasters if any of two giant search engines merge.

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