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Cloud Computing Expo - DoJ May Sue Google

Will the revenue-sharing Google-Yahoo deal be derailed?

Like it did when it took Microsoft to court, the Justice Department has hired a top litigator from the outside for a possible antitrust suit against Google, according to the Wall Street Journal.

The government is supposedly still accessing its case.

If it does decide to move, the paper says it is unclear whether the DOJ would simply try to derail the revenue-sharing Google-Yahoo deal - because together Google and Yahoo represent 80% of online search advertising in the US - or whether it has other issues with Google's ever-increasing power in online advertising.

The government has been deposing witnesses and subpoenaing documents at least since it started a formal investigation of the deal a couple of months ago.

The guy the agency hired is former Disney vice-chairman Sandy Litvack, who was antitrust chief during the Carter administration. The Journal says he resigned last week from Hogan & Hartson LLP, where he was a partner.

He's ostensibly going to examine the evidence amassed so far.

Reuters says both Google and Yahoo were informed that the DOJ is "consulting with Litvack but had made no decision."

Yahoo told the news service that "We have been informed that the Justice Department, as they sometimes do, is seeking advice from an outside consultant, but that we should read nothing into that fact."

Google has maintained that its deal with Yahoo in search advertising, set to take effect next month, isn't anticompetitive and voluntarily delayed implementing it so the government could review it.

Now it's saying that "While there has been a lot of speculation about this agreement's potential impact on advertisers or ad prices, we think it would be premature for regulators to halt this agreement before we implement it and everyone can judge the actual impact."

Action by the government would be an answer to Microsoft's most heartfelt prayers. It went running to Washington as soon as the Yahoo deal, the result of its attempt to buy Yahoo, was announced in June. It complained at a congressional hearing that Google would basically own the Internet.

The deal's latest critic is the Association of National Advertisers, which has asked the Justice Department to block it. It says it could lead to higher ad rates and an unhealthy concentration of power.

The ANA is nothing for an advertising medium like Google to sniff at.

More Stories By Maureen O'Gara

Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

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