Only a few days into what was described as a limited test of AdSense for Search in Yahoo's search results, rumors began that Yahoo would hand over more business to Google.
Well that didn't take long. A week into the Wall Street Journal cited people close to the matter on the likely expansion of this current partnership. Dropping AdSense into a limited set of Yahoo search results proved a positive experience.
Any expansion of the deal will have to be restricted in scope. Google and Yahoo own the top two search ad businesses; attempts to give Google a substantial part of Yahoo's paid search probably means lawsuits from Microsoft over antitrust concerns.
Microsoft already protested the initial test, claiming a Yahoo-Google tie-up places 90 percent of the search ad market in one place. They are extremely unlikely to sit idle in the face of an expansion of this first test.
"Even the $1 billion a year that Citigroup thinks an outsourcing deal could add to Yahoo’s cash flow probably wouldn’t sway Yahoo shareholders staring at a $45 billion Microsoft buyout offer, so why would some smaller portion of that sway them any more?" he asked.
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