Miss BoomTown Goes to Washington (Of Course, for MicroHoo Plus Google)
by Kara Swisher
Posted on July 15, 2008 at 7:00 AM PT
Please see this disclosure related to me and Google.
Today, BoomTown boards the Acela Express from New York’s Penn Station to D.C.’s Union Station to attend the Senate hearing on the Yahoo agreement with Google to outsource some of its ad search business.
Titled rather ominously, “The Google-Yahoo Agreement and the Future of Internet Advertising,” the Judiciary Committee’s Subcommittee on Antitrust, Competition Policy and Consumer Rights (eek!) will hear testimony at 10:30 a.m. at the Dirksen Senate Office Building from a passel of Internet reps, including those from Yahoo, Microsoft and Google.
It is chaired by Sen. Herbert Kohl (D., Wis.).
Will there be a lovely video of event? Indeed, there will be!
Added plus: I went to college and even worked on Capitol Hill, all before toiling at the Washington Post (Hey, Marcus!) for a dog’s age, so I know my way around the place.
And, as BoomTown readers might recall, I am not for the deal, mostly because it gives Google even more market power, even though the partnership is limited.
As I wrote:
As someone who has been a longtime critic of Microsoft’s (MSFT) historically thuggish tendencies, BoomTown finds it a little hard to believe that Yahoo and Google think that they can get away with any kind of significant search-ad outsourcing deal that would move the needle at Yahoo … .
And while it might be a long-cherished dream of Google’s to take over Yahoo search–and also get the chance to return to the scene of the crime, since Google got its first big push from doing Yahoo search, before Yahoo (YHOO) wised up too late–there is simply no way this will be allowed by regulators. Nor should it.
Still, you have to almost admire the chutzpah of the search giant in making this move, if the sheer and unadulterated arrogance of it wasn’t so distracting.
Because, while Google (GOOG) has almost none of the obvious menacing aggression that characterized Microsoft when it thoroughly dominated tech (although all those beach bikes on its campus inexplicably creep me out a little bit), the company still cannot be allowed to have a monopolistic share of the market.
It is bad for advertisers, it is bad for consumers, it is bad for innovation, no matter how well-intentioned Google is.”
So, you might imagine, I am looking forward to biting into this tasty piece of political theater!
Here is the list of speakers:
David Drummond
Senior Vice President
Corporate Development and Chief Legal Officer
Google
Mountain View, Calif.
Michael Callahan
General Counsel
Yahoo!
Sunnyvale, Calif.
Brad Smith
Senior Vice President and General Counsel
Microsoft
Redmond, Wash.
Matthew Crowley
Chief Marketing Officer
Yellowpages.com
Glendale, Calif.
Tim Carter
President and CEO
Askthebuilder.com
Cincinnati, Ohio
Please see this disclosure related to me and Google.
Comments
How does this deal give Google any more market power? If anything, allowing Yahoo! to sell ads served up by Google’s technology will increase the supply of nuanced, tightly-targeted search ads, leading to downward pressure on Internet search ad rates. And as for the incentive to innovate, one has to believe that in a market economy, when one firm gives a chunk of its revenue to a larger rival it will have LOADS of incentives to innovate its way out of such an arrangement. Yahoo! may well be on a long, slow spiral to oblivion, but that has nothing to do with Google’s “market power,” since nothing Google does can make advertisers use search ads (versus banner, display and other Internet ads) or otherwise lock them in to AdSense. In the WSJ “free” market, firms get to reap the rewards of building better mousetraps; I think here Jerry Yang, despite his $$ billions, will have millions of reasons to go back to his engineering drawing board to out-think the folks from Mountain View.
Posted by Glenn Manishin at July 15th, 2008 at 12:45 pm