Yahoo Ad Deal PIRGed

As if Google and Yahoo didn't have enough problems, their multibillion-dollar search ad deal just got two more opponents on board. The U.S. Public Interest Research Group has sent the Justice Department a letter opposing the deal for a rather novel reason. If Google and Yahoo dominate 80 percent of the search market, they argue, competitors could never match their low ad rates and would have to find a different edge. Which means they'd have to do more market research on search users to better match them to ads. Which means less privacy for you, dear reader. Give 'em points for trying, but seeing as most critics argue the Yahoo deal would actually give Google the power to fix ad rates artificially high, this argument doesn't exactly hold water.

Meanwhile, Rep. John Burton, the ranking Republican on the House energy and commerce committee, has urged Justice to poke through the embers of the deal a few more times and said that Yahoo's answers to questions about the arrangement "seemed designed to obscure rather than clarify." Search Engine Land's Greg Sterling notes that Burton hasn't exactly been Google's best friend in the past; he had similar questions about the its acquisition of the display-ad company DoubleClick.

At this point, Google and Yahoo have gathered so many foes that Henry Blodget claims the deal is dead, as far as Wall Street's concerned. Blodget argues that another Microsoft offer for Yahoo is inevitable, but don't expect $33 a share this time. Microsoft's eagerness to buy Yahoo's search service stemmed mainly from its desire to keep it out of Google's hands. If Justice has done that for them, their sense of urgency—and their price—dwindles considerably.