| By Maureen O'Gara |
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| November 3, 2008 01:40 PM EST |
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1,532 |
The Yahoo-Google negotiations with the US government are reportedly over. The Justice Department has supposedly had enough.
The companies were told last Thursday to have their final proposal on how to structure their controversial revenue-sharing pact to prevent the DOJ from taking them to court in this week, preferably by tomorrow, according to The Deal.
Supposedly the would-be partners collapsed under pressure and are considering shorting their proposed 10-year axis to as little as a year and may have to limit the amount of searching they could cooperate on.
The Deal predicted two weeks ago that Yahoo and Google would ultimately walk away from their arrangement based on what lawyers close to the pair told the publication.
The Financial Times thinks that as much as Google doesn’t want to sign a consent decree with the government and submit to regulatory oversight it also doesn’t want to come away from the negotiations empty handed.
It would be “another sign,” the paper says quoting Citigroup, “that Google had become too large and it would be harder to make other strategic moves without stirring up scrutiny from regulators.”
The financial implications of not doing the Yahoo deal are relatively minimal for Google. For Yahoo it’s another crisis, representing $800 million a year.
The Wall Street blog Seeking Alpha figures if the deal is scrapped Microsoft is likely to buy Yahoo after it combines with AOL for something like $19-$22 a share, down from its original bid of $31.
About 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.
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