Yesterday, BoomTown went to Washington, D.C. to see lawyers from Microsoft (MSFT), Yahoo and Google face off in Senate hearings about the controversial search advertising outsourcing deal recently struck between Yahoo (YHOO) and Google (GOOG).

Titled “The Google-Yahoo Agreement and the Future of Internet Advertising,” the hearings were called by the Judiciary Committee’s Subcommittee on Antitrust, Competition Policy and Consumer Rights and chaired by Sen. Herb Kohl (D., Wis.).

As I expected, the hearings on the Yahoo agreement with Google (transcripts of testimonies here) to outsource some of its ad search business were a lot of show and not so much content.

There was also a hearing for the House’s Task Force on Competition Policy and Antitrust Laws, called “Competition on the Internet,” which featured the same trio of execs.

And here’s a video of BoomTown chatting up Google’s Chief Legal Officer David Drummond, Microsoft’s General Counsel Brad Smith and Michael Callahan, general counsel for Yahoo, right after the Senate hearings were over.

Please see this disclosure related to me and Google.

Sitting at the Senate hearings about the Yahoo-Google ad search deal this morning in Washington, D.C., let it be said that BoomTown is deeply dubious about whether it is a good thing for consumers and advertisers, as both Internet companies have asserted.

But this was my most certain conclusion:

The worst-case scenario is actually for politicians to meddle in the Internet space with their largely Web-ignorant mitts.

But that’s just me!

Titled “The Google-Yahoo Agreement and the Future of Internet Advertising,” the hearings were called by the Judiciary Committee’s Subcommittee on Antitrust, Competition Policy and Consumer Rights, chaired by Sen. Herb Kohl (D., Wis.).

In any case and as usual, the hearings on the Yahoo agreement with Google (transcripts of testimonies here) to outsource some of its ad search business were a lot of show and not so much content.

There was an interesting little testy back-and-forth between Sen. Arlen Specter (R., Pa.) over remarks that Yahoo (YHOO) CEO Jerry Yang might have made in a previous meeting with Microsoft (MSFT) that was recounted by Microsoft General Counsel Brad Smith.

The gist of it was that Yang sketched out a world of two “poles”–Google (GOOG) on one side and Microsoft and Yahoo on the other. And if Yahoo moved over to the Google side, the World Wide Web would be terribly askew!

Yahoo General Counsel Michael Callahan said that was not his recollection of the meeting, in which he also participated.

Specter wondered who was telling the truth, which only made me want to yell out: Welcome to the MicroHoo Hall of Crazy Mirrors, Senator!

Mostly, Google and Yahoo argued that by doing an ad-search partnership they would stay aggressively competitive with each other.

Microsoft, of course, argued that the end was nigh.

“Never before in the history of advertising has one company been in the position to control prices on up to 90 percent of advertising in a single medium,” said Microsoft’s Smith. “Not in television, not in radio, not in publishing. It should not happen on the Internet.”

Countered Yahoo’s Callahan: “The purpose of this commercial arrangement, the intent of Yahoo moving forward, is to make our company an even stronger competitor to Google, to Microsoft and to others in the dynamic and rapidly growing online advertising world.”

Of course, Google chimed in, via Google Chief Legal Officer David Drummond: “Google and Yahoo will remain vigorous competitors, and that competition will help fuel innovation that is good for users and the economy.”

Yes, concentration of power is always good for the world! I mean, Microsoft’s Windows monopoly turned out so well for the industry for so long!

Wait, that’s not a very political thing to say. (Then again, I completely forgot just how stuffy D.C. was and wore Silicon Valley garb–jeans and a T-shirt–to the hearing.)

In any case, the sideshow to the MicroHoo drama moves to the House side of Capitol Hill this afternoon.

There the Task Force on Competition Policy and Antitrust Laws held the less dramatically named hearing “Competition on the Internet.”

It was the same trio of Yahoo, Microsoft and Google lawyers, of course, and more of the same.

Which is to say–a lot of hot air, little movement, but much more evidence of the next phase of the Internet and the two true poles: The Web World War of Microsoft versus Google.

In any case and speaking of hot air, here’s my video interview with the lawyers from Google, Yahoo and Microsoft, which is also posted here:

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.

As a continuing public service, BoomTown translates the blog post yesterday that Google’s David Drummond (pictured below) wrote about Microsoft’s unsolicited bid to buy Yahoo for $31 a share.

Drummond wrote: Yahoo! and the future of the Internet
2/03/2008 11:45:00 AM
Posted by David Drummond, Senior Vice President, Corporate Development and Chief Legal Officer

Translation: Please excuse the extreme tone of self-righteousness tinged by the sweet, sweet irony of this egregious attempt by the most powerful Internet company ever to play victim, which is only possible when our foe is the Death Star from Redmond.

Sergey and Larry totally foisted the brass knuckles on me, since they had to go kite surfing in Mauritius. Also, I am posting this on Super Bowl Sunday, as a form of geekish counter-programming. Lastly, I am not implying here that Yahoo is the future of the Internet. We are, obviously, but its distress will work well for our self-interested purposes.

Drummond wrote: The openness of the Internet is what made Google–and Yahoo!–possible. A good idea that users find useful spreads quickly. Businesses can be created around the idea. Users benefit from constant innovation. It’s what makes the Internet such an exciting place.

Translation: By openness, we mean open in as far as Google will allow it to be open. By constant innovation, we mean our innovation. By exciting place, we mean our exciting place. And Yahoo was our Web company to kick around the Silicon Valley schoolyard and not Steve Ballmer’s.

Drummond wrote: So Microsoft’s hostile bid for Yahoo! raises troubling questions. This is about more than simply a financial transaction, one company taking over another. It’s about preserving the underlying principles of the Internet: openness and innovation.

Translation: Troubling in that we wish we could buy Yahoo, and put our money where our big fat mouth is. I mean, do you want the Web to be controlled by one dominant player that seems to have no one to rein it in, no one to thwart it when it inevitably turns into that scary machine in the “Terminator” and builds a time machine to send cyborgs back and to kill the leader of the humans? Of course, that’s actually the Google plot line, but let’s pretend the creators of MSN and the Zune could pull that kind of massive world destruction off!

Drummond wrote: Could Microsoft now attempt to exert the same sort of inappropriate and illegal influence over the Internet that it did with the PC? While the Internet rewards competitive innovation, Microsoft has frequently sought to establish proprietary monopolies–and then leverage its dominance into new, adjacent markets.

Translation: OK, let’s be honest, the era of Microsoft PC dominance is pretty much over now, but if we say “convicted monopolist” over and over, maybe we can revive that old bogeyman image of Bill Gates to scare all the little entrepreneurs. I mean, Eric Schmidt still gets night frights in which Microsoft Bob haunts his dreams.

Drummond wrote: Could the acquisition of Yahoo! allow Microsoft–despite its legacy of serious legal and regulatory offenses–to extend unfair practices from browsers and operating systems to the Internet? In addition, Microsoft plus Yahoo! equals an overwhelming share of instant messaging and web email accounts. And between them, the two companies operate the two most heavily trafficked portals on the Internet. Could a combination of the two take advantage of a PC software monopoly to unfairly limit the ability of consumers to freely access competitors’ email, IM and web-based services? Policymakers around the world need to ask these questions–and consumers deserve satisfying answers.

Translation: Convicted monopolist! Convicted monopolist! Convicted monopolist! And did we mention: Microsoft is a convicted monopolist. While very little ad money is made via instant messaging and Web email and that traffic still does not let them mint money in the basement like Google does, we’re still going to put the screws to the 3,356 lobbyists we hired in Washington, so as not to become, um, a convicted monopolist.

Drummond wrote: This hostile bid was announced on Friday, so there is plenty of time for these questions to be thoroughly addressed. We take Internet openness, choice and innovation seriously. They are the core of our culture. We believe that the interests of Internet users come first–and should come first–as the merits of this proposed acquisition are examined and alternatives explored.

Translation: This totally screwed up our plan to load up the GooglePlane with organic soy chips and pricey microbrewed beer and head to the Super Bowl, so we’re pissed.

Also, we are none too pleased about Microsoft’s meddling in our DoubleClick deal, so this gives us the opportunity for payback times 10 to the 100th. That’s a googol, which is, according to Wikipedia, “of the same order of magnitude as the factorial of 70 (70! being approximately 1.198 googol, or 10 to the power 100.0784), and its only prime factors are 2 and 5 (100 of each). In binary it would take up 333 bits.”

Figure that algorithm out, Monkey Boy!