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Google campaigns hard for search ad deal with Yahoo

September 19, 2008 | 12:20 pm

Google headquartersGoogle is aggressively campaigning for its proposed search advertising partnership with Yahoo, trying to ease fears among advertisers as the Justice Department weighs whether to bless, block or curb the deal.

Last week it was Yahoo's turn, with U.S. operations head Hilary Schneider defending the deal. Here's a recap of the week's Google spin:

First, it trotted out its chief economist, Hal Varian, to argue for the deal on the company's policy blog. Varian took issue with a SearchIgnite study claiming the partnership would result in higher prices for advertisers.

Then, Tim Armstrong, Google's president of advertising and commerce in North America, joined co-founders Larry Page and Sergey Brin and chairman and CEO Eric Schmidt in a media roundtable during the Internet search giant's Zeitgeist conference. They argued that the partnership not only complied with antitrust laws but would benefit users, advertisers and publishers.

Brin said that Google owed it to Yahoo to move forward with the partnership and to help assure that Yahoo would remain an independent company. After all, it was Yahoo co-founders Jerry Yang and David Filo who convinced Brin and Page ...

... to start Google. The two companies signed the ad partnership after merger talks with software giant Microsoft collapsed.

Tim ArmstrongSchmidt dismissed critics who contend the partnership, announced in June, will allow Google to monopolize search advertising and make the online advertising market less competitive. He took a swipe at Microsoft for orchestrating opposition to the deal.

Google also handed out a two-page press release designed to clear up any pesky misconceptions about the partnership. Schmidt said Google and Yahoo were committed to moving forward with the deal on or around Oct. 11, with or without the green light from the Justice Department. Federal regulators have hired litigator Sandy Litvack to vet the proposed partnership, which they have been reviewing for the past three months.

Yesterday and today, Armstrong repackaged the points made in the press release, promoting the benefits of the Yahoo partnership yet again. This provoked privacy watchdog Jeffrey Chester, who fired off an e-mail protesting all of Google's protesting. He said the deal wasn't as simple as Armstrong suggested:

In fact, Armstrong and Google, we believe, aren't being candid here. When an online ad company dismantles (or turns over) a core part of its search function to its leading competitor, it becomes fatally wounded. As Google knows all well, search and display (and online content) are all intertwined. Yahoo's future, in my opinion, as a full service online ad company is endangered, as more businesses realize that its search ad business relies increasingly on Google.

All Things D's Kara Swisher today took shots at the partnership, which she has opposed from the get-go, and then offered some reasons why Google and Yahoo should, and probably will, move forward. Among other things, she argues that the Justice Department does not want to take on Google.

Happy campaign trails, Google.

-- Jessica Guynn

Top: Google headquarters. Credit: Paul Sakuma / Associated Press

Bottom: Tim Armstrong. Credit: Google

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