Think Tank: GOOHOO Deal May Be A “Black Hole”

by admin September 23, 2008 at 9:40 pm

A Washington think tank devoted to antitrust issues has issued a 19-page analysis of the Google-Yahoo deal that warns that the transaction has the potential to become “a black hole that swallows up Yahoo.”

“We believe that the transaction could be blocked on antitrust grounds,” according to the report by the American Antitrust Institute, which conducted its analysis based on briefings with the companies and publicly available data.

Under the deal announced on June 12, Google would provide some of the ads for Yahoo’s search engine, yielding as much as $800 million annually for Yahoo. Yahoo says it will pour that money into improving its own search engine — in other words, partnering with Google to get more competitive with Google.

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