Google Tuesday ramped up its defense of a proposed search advertising deal with Yahoo Inc. by moving to debunk the assertions of some critics that the joint effort will boost the cost of advertising.
Hal Varian, Google's chief economist, took aim at what he called "misconceptions" about the deal in a blog item posted on the company's Web site Tuesday.
The post comes a week after the Google-Yahoo deal came under fire from major advertising groups, and the U.S. Justice Department hired a top litigator to look into a possible antitrust violations. On Monday, the European Union confirmed that it has launched a preliminary investigation into the antitrust implications of the deal.
Google had been quiet about the criticism until Tuesday's blog post by Varian, who takes issue with July report from SearchIgnite, a maker of search optimization tools, that said the deal could boost keyword advertising prices on Yahoo by 22%. Varian contended that the SearchIgnite report has been fueling misconceptions about the Google-Yahoo deal.
Varian said that advertisers will get better performance for their advertising dollars at "prices that reflect that improved performance," he noted. "The report fails to acknowledge that ad prices are not set by Yahoo or Google, but by advertisers themselves, through the auction process. Since advertisers set prices themselves via an auction, the prices must ultimately reflect advertiser values. That process will remain completely unchanged by our agreement."
More: http://www.pcworld.com/article/151136/article.html?tk=nl_dnxnws
Hal Varian, Google's chief economist, took aim at what he called "misconceptions" about the deal in a blog item posted on the company's Web site Tuesday.
The post comes a week after the Google-Yahoo deal came under fire from major advertising groups, and the U.S. Justice Department hired a top litigator to look into a possible antitrust violations. On Monday, the European Union confirmed that it has launched a preliminary investigation into the antitrust implications of the deal.
Google had been quiet about the criticism until Tuesday's blog post by Varian, who takes issue with July report from SearchIgnite, a maker of search optimization tools, that said the deal could boost keyword advertising prices on Yahoo by 22%. Varian contended that the SearchIgnite report has been fueling misconceptions about the Google-Yahoo deal.
Varian said that advertisers will get better performance for their advertising dollars at "prices that reflect that improved performance," he noted. "The report fails to acknowledge that ad prices are not set by Yahoo or Google, but by advertisers themselves, through the auction process. Since advertisers set prices themselves via an auction, the prices must ultimately reflect advertiser values. That process will remain completely unchanged by our agreement."
More: http://www.pcworld.com/article/151136/article.html?tk=nl_dnxnws
