Analysts are desperately watching to find out whether two Internet giants are talking about joining forces to create an almighty search-advertising partnership.
Days after a Yahoo deal designed to challenge Google’s (News - Alert) advertising dominance fell through, the two search engine companies are now rumored to be discussing a joint venture. Some analysts say that Sunnyvale, California-based Yahoo would outsource its business to Mountain View-based Google, with an eye on generating more money together than they do separately now.
Yesterday, before Google’s annual meeting, Chief Executive Eric Schmidt and co-founders Sergey Brin and Larry Page declined to say whether they were close to a deal.
Though the trio admitted to holding a two-week trial last month, the three men repeatedly dodged reporters’ questions.
“We have had a brilliant test. We like them very much,” Schmidt said, according to Forbes.com.
“If a partnership comes to fruition, we would structure a deal within antitrust concerns,” he said, according to Forbes.com.
According to the online magazine, the companies may be trying to figure out how to structure a deal that wouldn’t draw accusations of anti-trust violations. One strategy may be for Yahoo! to not outsource its entire search and ad business.
Given Yahoo’s recent talks with software giant Microsoft (News - Alert) Corp., some analysts say the Google-Yahoo deal could be a way to finally put to bed Microsoft’s lingering $40 billion-plus offer for Yahoo.
Google’s top trio had said they wouldn’t be “happy” if the Yahoo-Microsoft deal went down.
“Had the merger gone through, we would have had to have a meeting around it,” Schmidt said. “We would have had to have a campaign against it.”
Michael Dinan is a TMCNet Editor. To read more of his articles, please visit his columnist page.
