Yahoo-Google in new advertising deal

by Rory Cellan-Jones
The Yahoo-Google drama
BBC dot.life technology blog

Yahoo has agreed a deal with Google which will see Yahoo use the search engine giant's advertising technology. Under the agreement, Google ads will appear alongside some Yahoo search results in the US and Canada.

The announcement came after Yahoo said it had failed to persuade Microsoft to renew its bid to buy all of the internet company. Recent talks concluded after Yahoo rejected a Microsoft proposal to buy just its online search business.

Yahoo said the agreement with Google could be worth up to $800m (£410m) in additional revenue every year.Alarm bells were already ringing on Capitol Hill over Yahoo's 'limited' trial in April of Google's technology

"This commercial agreement provides Yahoo with the opportunity to deliver more relevant ads to users and provide advertisers and publishers with better advertising technology," said Eric Schmidt, Google chairman and chief executive.

"We believe that the convergence of search and display is the next major development" in online advertising industry, said Yahoo chief executive Jerry Yang.

The partnership will initially last for three years, but could last up to 10 if Yahoo decides to renew.

Google said the deal did not need regulatory approval but that it would delay its implementation
by up to three and a half months to give the US Department of Justice a chance to review it.
However, the deal is likely to attract attention from competition regulators in Washington, according to the BBC's technology correspondent Rory Cellan-Jones.

"Alarm bells were already ringing on Capitol Hill over Yahoo's 'limited' trial in April of Google's technology," he said. Read more...