Microsoft-Yahoo merger triggers anti-trust questions!!

Microsoft Corp. and Yahoo Inc. have finally joined forces against industry giant Google Inc. Microsoft was wooing Yahoo to surrender the second largest search engine and join forces in an attempt to challenge the dominance of Google in the online advertising market.


They entered a 10-year deal whereby both companies will use Microsoft’s new search technology, Bing while Yahoo takes on the responsibility of diverting sales from Google. Google makes more than $20 billion a year through sales of premium search-related advertising. Bing's U.S. market share will rise to 28 percent once it claims Yahoo’s audience, though it is much below the significant 65 percent of U.S. searches handled by Google.

So far so good! The effect of this merger on Google will take some time to realize but in the meantime this new Internet search partnership is facing fire from the anti-trust lobby. The deal is sealed but it will come into effect only when it passes the anti-trust review. Anti-trust regulators, both in the US and overseas, will scrutinize this deal as it will have far-reaching ramifications on consumers and advertisers.

The deal was opposed by Center for Digital Democracy, an online privacy advocate in Washington last year. The U.S. Public Interest Research Group is also against this merger, though officials from both the Justice Department and the Federal Trade Commission have not commented so far.

Last year when Google tried to snag a search advertising deal with Yahoo, U.S. antitrust officials played spoilsport. So, it will come as no surprise if Google opposes the Microsoft-Yahoo deal. This anti-trust saga will last for sometime especially as President Barack Obama has promised to ensure a more rigorous antitrust review on deals. Let’s wait and watch!!