Report: Yahoo could run Google ads next week

by Steven Schwankert

May 2, 2008 —

Yahoo could begin carrying
Google ads within a week,
as it waits for Microsoft
to give up its acquisition
bid or attempt
a hostile takeover, The Wall Street Journal reported Friday.

An ad agreement with Google would make it more difficult for Microsoft to take
over Yahoo, and would provide Yahoo with increased cash flow in either scenario,
the Journal said, citing people familiar with the situation. Yahoo and Google
tested their proposed ad system over the last two weeks, which faces government
scrutiny over possible anti-competitive practices. Both companies compete with
Microsoft in various areas, and want to keep their rival at bay.

The deal, if it moves forward, could be worth as much as an additional US$1
billion per year for Yahoo under a revenue-sharing arrangement with Google,
according to a Citigroup analyst.

Yahoo is looking for alternatives to satisfy shareholders that it should remain
independent and fend off Microsoft's unsolicited bid to buy the Internet company.
An announcement regarding Microsoft's plan to abandon the acquisition or try
to takeover Yahoo is expected soon.

IDG News Service