Google-Yahoo Put Partnership On Hold; Talks With DOJ 'Continuing'

This story was written by David Kaplan.
In order to give the Department of Justice more time to determine whether or not Google's (NSDQ: GOOG) and Yahoo's (NSDQ: YHOO) ad search pact runs afoul of anti-trust laws and will create any undue anti-competitive pressures against the online ad industry, the two will suspend working together, AllThingsD reports, citing sources close to the situation. Adam Grossberg, a Yahoo rep, confirmed that report for paidContent, saying, "The companies have agreed to a brief delay in implementing this agreement to continue our ongoing discussions with the Department of Justice.  We have had discussions with regulators and look forward to responding to their questions about this agreement."

The deal was set to begin in the middle of this month, but with opposition mounting, the companies had little choice other than issuing a delay. On Thursday, Sen. Herb Kohl (D-Wisconsin), chair of the antitrust subcommittee, said that even if the DOJ does give Google-Yahoo the go ahead, the deal will still require close monitoring to ensure it doesn't cross the line into a full violation of antitrust statutes. If the DOJ grants its assent to the partnership, the two companies will have over 80 percent of the search market. Microsoft (NSDQ: MSFT) has been lobbying Congress and regulatory officials hard against the deal, which Yahoo used to help block the software company's efforts to take it over. 

By David Kaplan