Posted November 5, 2008 11:36 am by with 19 comments

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Despite recent attempts to appease the DoJ, Google has decided to terminate its advertising partnership with Yahoo.

Here’s a statement, just released by Yahoo….

…Google has terminated the advertising services agreement the companies announced in June. Yahoo! continues to believe in the benefits of the agreement and is disappointed that Google has elected to withdraw from the agreement rather than defend it in court. Google notified Yahoo! of its refusal to move forward with implementation of the agreement following indication from the Department of Justice that it would seek to block it, despite Yahoo!’s proposed revisions to address the DOJ’s concerns.

And, Google has added its side of the story

…after four months of review, including discussions of various possible changes to the agreement, it’s clear that government regulators and some advertisers continue to have concerns about the agreement. Pressing ahead risked not only a protracted legal battle but also damage to relationships with valued partners. That wouldn’t have been in the long-term interests of Google or our users, so we have decided to end the agreement.

Where does this leave Yahoo? Will it go back to Microsoft? And, does this mean I was right–Google only cared about blocking Microsoft and not actually getting the deal done?

I’d love to hear your thoughts.

  • Brent

    I think this puts MSN back into the game. With Y! stock so low the question is Y not?

  • Atom McCree

    I think your right, Deal blocker to keep Microsoft at bay for a while. Unfortunate thing is Microsoft will indeed buy Yahoo for cheaper than it would have before. So while it seems true, it was a bad move on Google’s part. They should have made Microsoft pay more rather than less.

  • BarbaraKB

    Truly means MS buying Y! rumors back in the news. Also, I don’t believe it’s a bad move for Google to back out @ all. Google sees itself as a global corp and the international challenges were overwhelming.

    BarbaraKB’s last blog post..Marketing, social media and advertising consultation

  • Mike Moran

    I was never sure about Google’s only interest being blocking Microsoft. That would mean Google was being disingenuous and sneaky–I mean that’s evil, isn’t it? And we all know that Google would never…

    As it’s turned out, Yahoo! is very weak now and Microsoft isn’t much better, Pairing them up is no big threat to Google, I don’t think.

  • Andy

    Not a surprise this happened. However for investors there is now the possibility to play a potential takeover for profit. I wrote about this today and for long suffering yahoo shareholders this may be a way to make some money before christmas.

    Andy’s last blog post..Car Repairs & 5 Tips to Avoid Getting Ripped Off

  • Frank Reed

    Let’s face it. Google really doesn’t NEED anyone or anything at present. I hope that they are internally talking about how they protect themselves from the inevitable tumble that has afflicted every ‘untouchable’ company (remember IBM’s tumble?. I think that should be there biggest concern moving forward because they have taken a hit of their own Kool- Aid it could get weird.

    Frank Reed’s last blog post..In Search Of a New Day and New Business

  • Busby SEO

    What ever it takes, it’s going interesting. And Google still rules the internet

    Busby SEO’s last blog post..By: edtechguide

  • Nick Stamoulis

    I had a feel this would occur. A partnership of this magnitude will take a great deal of massaging.

  • galin

    I am not surprised at this news. I was sure that Google did not need yahoo at all. The only way out for Yahoo is to join Microsoft. Together they will be able to be a great threat to Google. But we’ll see in what way the things will go on..

  • Zurpit

    Now that Google is withdrawing from the deal, I wouldnt be surprised to see Microsoft and Yahoo make a deal of their own to go against Google

  • brandon alan scofield

    I agree with you galin, Yahoo have to ask Microsoft to make their own deals against google ..

    brandon alan scofield’s last blog post..First post

  • Saad Kamal

    What if now MSFT backs off from their initial acquisition deal…

    And Whats going on with the Yahoo-AOL deal?

    Saad Kamal’s last blog post..Google Profile Search

  • Goran Web Design

    Yahoo had tons of other deals prior to the Google one, like they had an active deal with MSN and where also in negotiations with AOL.

    I think Google just wanted to block Microsoft out.

  • savings

    This still shows the dominance from google as we have seen with more investments offline, an article I read says even though this is bad news for both companies, Yahoo’s stock price has increased 4.3 percent at the time of writing, to $13.92; and Google falling 6.7 percent to $342.24.

  • Nicole Price

    The story is far from over. The original knight in armor will return.

    Nicole Price’s last blog post..Ideas for a Mother-to-be

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  • Utah SEO Pro

    Always some sort of new Drama w/the big 3 search engines.

    Utah SEO Pro’s last blog post..The Future of SEO

  • SEO Tips South Africa

    Google is just being nice….publically anyway….Yahoo is a spent force in search. Their backlinks stats are still king though…heheheheh

  • Ultimate Blackhat

    Let them fight it out and they will be signing another contract eventually anyway.