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Google keeps talking on Yahoo deal

By Reuters News Service
Florida, 22 Oct 2008

Google has agreed to keep talking with the US justice department about its proposed online advertising deal with Yahoo, says CEO Eric Schmidt.

Under the deal announced in June, Yahoo would turn over some of its online advertising space for Google to sell.

Schmidt had said in August the company would move forward with the Yahoo search partnership in October, with or without approval from anti-trust reviewers at the justice department.

"We agreed to extend our discussions... with the DOJ," Schmidt said when asked for an update on the Yahoo deal after he participated in an economic summit in Florida with Democratic presidential candidate Barack Obama.

Schmidt was repeating a decision first announced on 3 October that it would not begin sharing advertising immediately in order to give the justice department time to assess it, said Google spokesman Adam Kovacevich in Washington.

"He was reiterating what we announced several weeks ago," he said.

The advertising deal is unpopular with some advertisers because Google and Yahoo dominate the US Web search market. They fear their rates could go up.

Google's market share widened to 63% in August, while Yahoo's dropped to 19.6% and Microsoft's slipped to 8.3%, according to comScore.

The deal to share advertising has been widely seen as an effort to help Yahoo fend off Microsoft by bringing Yahoo an additional $800 million in annual revenue.

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