DOJ Threatens; Google Drops Deal

Washington, DC, November 5, 2008 – After the announcement today that Google will no longer pursue a partnership with Yahoo, Steve Pociask, president of the American Consumer Institute issued the following statement:
“The announcement by Google that they would abandon their deal with Yahoo, after the Department of Justice informed them they would seek to block the deal, is good news for consumers.  The Department should be commended for their willingness to take action against an agreement that would have given Google even greater control over the online search and advertising marketplace.  This deal, between the #1 and #2 search engine companies, would have given Google nearly 90% of the search advertising marketplace.  The DOJ was right to decide that this arrangement would have violated the law and harmed consumers. 
“Because Google’s actions may well have left Yahoo in a weaker position to compete, we hope today’s news results in greater antitrust scrutiny on their dominance in the marketplace.  In the past, we’ve argued that the market may have irreversibly tipped to Google and there is insufficient competition to challenge their position.  This dominance merits additional antitrust scrutiny.”
An ACI ConsumerGram in May of this year took a closer look at the ramifications of this deal.  The document is available at www.theamericanconsumer.org.  

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