Google pulls out of search ad deal with Yahoo


Yahoo! announced that Google has terminated the search ad services agreement the companies announced in June. Yahoo! continues to believe in the benefits of the agreement and is disappointed that Google has elected to withdraw from the agreement rather than defend it in court. Google notified Yahoo! of its refusal to move forward with implementation of the agreement following indication from DOJ that it would seek to block it.
DOJ, in a statement issued on Wednesday, confirmed it had told Google that it planned to file a lawsuit to block the deal on antitrust grounds.

"Had the companies implemented their arrangement, Yahoo’s competition likely would have been blunted immediately with respect to the search pages that Yahoo chose to fill with ads sold by Google rather than its own ads," the Justice Department said.

Advertisers — who likely contacted regulators — hotly opposed the deal, arguing that Google and Yahoo’s dominance of the market could mean they would increase prices.