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Canada to Probe Google-Yahoo Advertising Deal

Posted on: Wednesday, 27 August 2008, 06:00 CDT

Google and Yahoo are facing a probe from Canada's Competition Bureau over their proposed advertising partnership.

The companies announced the advertising deal in June after Yahoo rejected Microsoft's acquisition bid. It will allow Google to run ads with Yahoo's search results for four years, with two three-year extensions. The deal only applies to the US and Canada.

Yahoo expects the partnership to generate approximately $450m in internet advertising sales annually.

Google told US lawmakers that the deal will expand competition without increasing its share of search traffic. According to research firm ComScore, the company had a 61.9% share of US internet queries in July, followed by Yahoo with 20.5%, and Microsoft with 8.9%. The search market in Canada is similar, except that Microsoft has a bigger market share than Yahoo.

Anthony Durocher, senior competition law officer at the Competition Bureau, said: "It is a sizeable agreement and we are going to take a close, hard look at it."

Source: Datamonitor

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