Mission accomplished: Google's ad deal with Yahoo has already worked

Mission accomplished: Google's ad deal with Yahoo has already worked

Summary: Google and Yahoo are reportedly close to walking away from their search ad deal after meetings with the Department of Justice.According to the Wall Street Journal:The two companies met Thursday with the Justice Department, part of a series of meetings to address the concerns of regulators.

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Google and Yahoo are reportedly close to walking away from their search ad deal after meetings with the Department of Justice.

According to the Wall Street Journal:

The two companies met Thursday with the Justice Department, part of a series of meetings to address the concerns of regulators. While the parties may agree to continue the talks -- or they could reach a resolution -- there are signs they are unwilling to make compromises to address the Justice Department's objections.

Is this story (Techmeme), which Kara Swisher notes is hedged out the wazoo, on target or some game of Google chicken?

The answer is probably a little of both, but there's another reason this Google-Yahoo search ad affair is toast: Google has already accomplished its mission. Remember back a few months ago when Google became the alleged savior of Yahoo? Why did that happen? Microsoft was trying to buy Yahoo. Google--and Yahoo for that matter--wanted to derail Steve Ballmer & Co. and the search giant was happy to oblige. And Yahoo in arguably the dumbest move in recent business history turned down Microsoft's $33 a share offer. For Yahoo shares that blunder was $20 ago.

Also see: Yahoo: What happens if Google deal doesn’t go through?

Bottom line: Google has already cast enough doubt about Yahoo, which appears to need its biggest rival now more than ever. Microsoft is out of the picture (but never say never). Yahoo is fumbling around with AOL in a prospective marriage based on the theory that two turds can become an apple pie. And Google doesn't need this Yahoo deal anyway.

In the end you're left with this question: Why wouldn't Google walk away? There's no need to taunt the DOJ. The Yahoo deal won't materially affect Google's earnings and revenue. And Google's search rivals--Microsoft and Yahoo--are both weaker today than they were a few months ago. Google's job is done. Back away from the Yahoo deal gracefully.

Topics: Social Enterprise, Google

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16 comments
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  • Dumbest?

    "And Yahoo in arguably the dumbest move in recent business history turned down Microsoft?s $33 a share offer."

    Dumbest? Only if the stock market is the only thing in the world that matters and customers don't matter at all.
    CobraA1
    • Not much help to customers

      if you're out of business! Yahoo ended up laying off several thousand employees anyway - and based on the performance of Yahoo mail and other products, customer satisfaction was never high on Yahoo's priority list anyway.
      hickum
  • I think you got it wrong, Google failed

    to think this is some ploy, some caculated maneuver, then you're forgetting the latest news.
    Sure Yahoo is the weeker for it, but so is Google

    18 months ago Google could ask, and receive anything it pretty much wanted, but the love affair is diminishing: they have to earn things now like eveyone else.

    Look at the deals that have been blocked where in the past it was pretty much automatic, look at the lawsuits they've had to settle, the massive drop in stock prices, the scutiny by the EU, the loss of top people, the scale back on perks, ect.

    Google needs wins, and this would be yet another loss. If word would even get out that the "deal" was nothing more then to throw a monkey wrench into a merger of some kind, then Google would never be able to survive a visit from the SEC.

    This is Google thinking it could get what others wouldn't be allowed to get, and I'm sure it stings if the DOJ says no.
    AllKnowingAllSeeing
    • Did they fail?

      Part of the perception that this is a calculated plan by Google (at least by me) is - other than scuttling the takeover - what did Google really have to gain from the Yahoo deal? Did they really need the traffic? I'm not certain about that.

      If not, then Google may indeed be a winner. If they learned a lesson about kowtowing to the government and lobbying, on an issue which costs them nothing, and where they actually achieved what they hoped for, then it's a win for Google.
      hickum
      • Google wins here

        Bottom line is, throwing a wrench into the Microsoft deal was a big motivating factor, whatever they want to say. Google didn't need that traffic. If Yahoo goes under then Google stands to pick up a lot of the people who used Yahoo. Most likely they're going to get 70-80% of the client base.
        LiquidLearner
  • I bet the Yahoo shareholders are thrilled

    and oh so glad Yang had this fantastic plan and walked away from the MS offer. Buwahahahaha
    No_Ax_to_Grind
    • I Bet ZDNet Readers Are Thrilled

      To see yet another stupid prediction of yours biting the dust.

      Buwahahahahahah.
      itanalyst2
      • And you assume MS

        won't come in and buy Yahoo for 10 cents on the dollar once Icann tires of it.
        No_Ax_to_Grind
      • Oh, we are :) (NT)

        nt
        Stuka
      • You two should go get a room.

        Can't you see that you're in love with each other?
        Hallowed are the Ori
  • RE: Mission accomplished: Google's ad deal with Yahoo has already worked

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    techmagazinerd.com
  • To be honest..

    This couldn't have gone down any better for either MS or Google had they worked together to plan this to shut Yahoo down. Yang was an idiot for thinking that Google, their biggest competitor, would swoop in and save them from MS. To Google it was a bit of extra revenue and they got to stick it to MS. To his credit I doubt he forsaw it getting this bad even in the worst case scenario but still... It was a terrible decision on Yahoo's part to turn down the MS offer and a blessing in disguise for MS. If Yahoo folds MS and Google are both winners since MS will probably scoop up the search and advertising portions of Yahoo in the fallout.
    LiquidLearner
  • RE: Mission accomplished: Google's ad deal with Yahoo has already worked

    wow.... yahoo shares are 13-14 dollars.... amazing how 33 dollars a share was way undervalued...

    Great decision Yang...
    I guess go back to sellling tucker cars...
    daveaaa2
  • Either way, it's comedy gold business wise

    Yahoo to the good shark to avoid the bad shark trying to bid, bite them into their belly, poisons the waters for Microsoft, they are saved, yahoo! Economy tanks, money's tight, and Google's just not keeping hope alive for their deal. Wow, Yahoo in dark waters again, enough so that AOL again is an option for rescue, . . . yep, deal has already worked. MS saved some cash that may have been wasted on Yahoo, Google has a weaker fish to scoop up, and AOL as anybody's partner is like an anchor straight to the bottom.
    Boot_Agnostic
  • RE: Mission accomplished: Google's ad deal with Yahoo has already worked

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