Just some excerpts from today’s coverage, to give policymakers and the public a sense of how the 10 year pact is viewed from inside the ad industry.
First, from Ad Age: “Yahoo is outsourcing search monetization to Google in a 10-year deal, the companies officially announced tonight. But advertisers see less competition and higher prices…But the agreement… doesn’t necessarily protect Yahoo from the possibilities that the deal will erode its search business in the long run or make Google an even more dominant player. When Google search ads are mixed in with Yahoo search ads for a particular search query, Google will almost always win the better placement… And if Google consistently wins, marketers may be less inclined to bother using the Yahoo system, instead choosing to put their optimization efforts toward a single system.”
Yahoo, Google Strike a Deal on Paid Search. Abbey Klaassen. Ad Age. June 12, 2008 [sub required]
Online Media Daily: “…some in the industry have questioned whether Yahoo brass thought about the repercussions of the deal in terms of competition and advertiser perception in the mid- to long-term.
“I think the financial rationale is pretty clear,” said Bryan Wiener, CEO of 360i. “But $450 million is a lot of money, so it can’t just be all tail terms that Google will be serving. I can’t imagine that there won’t be some very valuable commercial terms in that mix.” Wiener said that if advertisers no longer saw the value in buying keywords directly through Yahoo, then fewer companies would end up using (Yahoo’s Search Advertiser Platform) Panama in the long run.
According to Neeraj Kochhar, vice president/director of SMG Search, there are definite concerns among advertisers. “I don’t see this as a positive move in terms of competitive activity,” Kochhar said.”
Final Microsoft Rebuff Sends Yahoo into Google’s Arms. Tameka Kee. Online Media Daily. June 13, 2008 [reg. required]
Stephanie Clifford of the New York Times has a good blog post on advertising industry concerns about the deal.
From the Los Angeles Times, 6/14/08:Â “The consolidation of everything under Google is not good,” said Aimee Reker, global director of search at digital agency MRM Worldwide. “It will aggregate so much power and control in one place that it no longer is an open marketplace.”