Yahoo-Google deal will hit pockets of advertisers

The impact of the deal between the two main search giants – displaying Google’s ads on Yahoo – may not be felt in the UK and Europe for some time but search experts feel it will come.

At the moment it is bogged down in US competition law but predictions say between six and 12 months and the most likely outcome is that it will hit clients in the pocket.

Less slots will be available to advertisers on Yahoo because they could be taken up by ads from Google although it will all depend on which key words Yahoo opens up to the partnership.

Steak Media chief executive Oliver Bishop said: “Should Yahoo need an influx of revenue, turning the dial up becomes increasingly attractive.

“Google ads tend to command higher bid prices so the Yahoo dilemma will be whether to display the Google ads and get a share of the revenue from the click or display their own lower-priced ads and keep all the revenue.”

However, if Yahoo becomes more expensive then the deal could have the adverse affect of pushing advertisers into Google’s arms.

Cass Heaphy, online marketing director at search specialist Strange, said: “The market you follow is where you can get the best price for your consumer so Yahoo has to be careful it doesn’t throw the baby out with the bath water.”

Yahoo is clearly under pressure in the boardroom following its failed deal with Microsoft but the Google deal is not exclusive and Microsoft’s reaction will be telling as it moves to ensure the market is not sewn up.

For consumers it should make for a better set of search results with Yahoo bringing in ads in areas where it recognises Google serves the market better.

Paul Doleman, iCrossing chief technology officer and vice president of paid search, said: “If it is done well and managed well it should lead to a better user experience.”

He also believes that although the deal might be cleared in the US, the UK may prove trickier because of Google’s dominance. The latest Hitwise figures showed Google received 87% of UK searches in May.

The other remaining question is whether the partnership could broaden beyond its existing parameters to areas where experts see Yahoo as stronger such as its display model, MyYahoo and other social elements.

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