Sen. Kohl Urges Close Watch of Yahoo/Google Deal
According to Sen. Herb Kohl, member of the Senate antitrust panel, Yahoo’s deal to put Google ads on its searches may hurt the industry.
Sen. Kohl, a Wisconsin Democrat, said the antitrust panel was not admitted access to "confidential business information supplied by the companies to the department," and therefore would not urge for the deal to be blocked.
The Senator does believe that if the amount of advertising outsourced to Yahoo grows, there will be a threat to competition in the industry.
He did urge the subcommittee to step in if Google begins to gain a dominant position over Yahoo due to the agreement.
Advertisers have worried that the deal to put Google ads on Yahoo’s website would end up costing them money.
The deal, agreed to in June, has been under review by the Justice Department and has not yet been implemented. When implemented, the companies combined will control 80 percent of the search engine market.
Many have seen the deal as an attempt by Yahoo to increase revenue from $250 million to $800 million to prevent being bought out by Microsoft.
Kohl warned that the deal raised questions as to whether advertising prices would increase, and as to how it would affect Yahoo.
"Should the amount of advertising outsourced by Yahoo to Google grow significantly, we believe the threat to competition will also increase," said Kohl.
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