Yahoo's Diabolic Move: Ad Deal with Google

Back on February 1st, Microsoft made a $44.6 billion bid to Yahoo, imposing an April 26 deadline for the Sunnyvale company which is supposed to accept or refuse the offer. Instead of giving an official answer, Yahoo has just made what seems to be an at-least diabolic move: an ad deal with Google, the Mountain View company whose motto is actually "Don't be evil!". Anyway, the agreement means that Yahoo will provide a small part of its advertising space, 3 percent, to Google, the giant publishing its adverts on Yahoo's search results.

Thus, Yahoo may receive an important percentage of the money generated by the ads while Google's advertising platform grows up in popularity, reaching remarkable levels (it's a well known fact that Google's ad solutions were already regarded as the most popular on the web).

Beside these ads, Yahoo will continue to run its own advertising platform which is quite similar to Google's, placing them straight on the SERP, next to the links returned to users' searches.

Although it's obvious that Yahoo's move was clearly made to frustrate the Redmond-based company Microsoft, the action behind the scenes is more exciting. According to MarketWatch, Google's chief executive Erich Schmidt called Yahoo's Jerry Yang on Friday, just after the Windows creator had made its bid to the Sunnyvale firm. "While neither company has commented publicly on the call, a search-outsourcing deal is the most commonly envisioned scenario, as an outright merger between the two companies would be unlikely to pass muster with regulators," MarketWatch explains.

What's interesting to see is actually the regulators' comments because such a deal would clearly give Google an impressive advantage on the advertising market although it's a well know fact that the Mountain View company has been at the helm of this side of the industry for some time now.

However, there's more to come in this dispute as Microsoft has already gave an official response to Yahoo's move. You can read more on the subject on this link.

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