Google On Yahoo: We’d Be Kind Of Like Canon And HP…
May 22nd, 2008 | by programming |If Google (NSDQ: GOOG) expands its partnership with number two search ads provider Yahoo (NSDQ: YHOO), how will the company deal with the expected rush by regulators to slap it with an anti-trust suit? NYT quotes Google CEO Eric Schmidt as saying only: “We would anticipate structuring a deal to address antitrust concerns.” In other words, trust us. Behind the scenes, Google execs say that any deal would be analogous to that involving the supplier of any other product, like printing supplies or cell phone service. Speaking of the printer industry, Google says look at Canon, which provides printer engines to roughly 80 percent of the laser printer market—including rivals like Hewlett-Packard.
But legal experts cited by NYT say regulators aren’t likely to buy Google’s printing industry comparison. What counts with regulators is whether the efficiencies the companies gained through partnership outweigh the risk of reduced competition. And a combination between the two dominant search ad providers make the argument of reduced competition a tough hurdle to jump over.