Thursday, April 10, 2008

Yahoo To Outsource Ads To Google; Gimmick to Thwart of Microsoft Purchase?

Yahoo will begin a limited test of AdSense for Search:
-- The test will only apply to US searches off of, and will not affect affiliates in any way.
-- It will just run for two weeks, and will be limited to 3 percent of search queries, underscoring the fact that this is all about gaging the impact of such a move.
-- The announcement maintains that the company has not made a decision to permanently join the AdSense for Search program, and that it’s all part of an ongoing effort to pursue commercial business relationships that enhance shareholder value.

A number of online ad industry execs expressed extreme skepticism that Yahoo s serious about pursuing a larger, more long-term outsourcing arrangement with Google on paid search. Yahoo has taken care to make this a very limited test: only U.S. searches on are involved, affiliate deals will not be affected in any way and it’s over in two weeks. While most of the execs I spoke to believe this is merely a way to thwart Microsoft, some believe that, if carried further, this kind of relationship would severely harm its relationship with advertisers across all its vehicles and ultimately undermine the enormous time, energy and money the company has spent in fashioning itself as a major seller of online ad inventory.

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