$100 Billion Might Persuade Regulators to Block Google/Yahoo Ad Deal
If you were in charge of approving or denying Google’s search ad deal with Yahoo, would $100 billion influence your decision?
I’m not talking about a check with your name in the "PAY TO" section, but a protest letter from a group of advertisers that, combined, control $100 billion in marketing spend. Would that make you think twice about giving your stamp of approval?
Well, the Association of National Advertisers (ANA) just sent a letter to the antitrust division of the U.S. Department of Justice, citing its opposition to the Google-Yahoo search advertising deal. In a statement, the ANA stated:
The ANA has sent a letter to Thomas O. Barnett, Assistant Attorney General, U.S. Department of Justice (DOJ), citing its objections to the announced Google-Yahoo search advertising partnership now under review by the DOJ. In preparing this letter, ANA conducted a comprehensive, independent analysis, which included input from the Board’s members and face-to-face discussions with Google and Yahoo.
The letter, authorized by the ANA Board, notes that a Google-Yahoo partnership will control 90 percent of search advertising inventory and states ANA’s concerns that the partnership will likely diminish competition, increase concentration of market power, limit choices currently available and potentially raise prices to advertisers for high quality, affordable search advertising.
There’s some serious clout behind those words. Aside from the $1B budget, the ANA consists of many Fortune 500 companies including Walt Disney, Johnson & Johnson, and Procter & Gamble.
I personally don’t see what the big deal is. Under the partnership, Yahoo is still free to partner with other companies and advertisers are the ones who control search advertising prices–at least for the most part.
Google and Yahoo were prepared for some opposition to the deal–hence agreeing to give regulators 100 days to review the deal–but they probably weren’t expecting such stout opposition.
What’s your take on the deal?