Thoughts on the Microsoft-Yahoo Deal

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CDT is still considering the policy implications of Microsoft’s unsolicited takeover offer for Yahoo. Clearly, this would have a major impact on the Internet. Our colleague, and CDT Fellow, Peter Swire has a detailed summary that he posted to the Center for American Progress Web site. He also sent us this quick overview:

Privacy Issues Will be Key in Review of Microsoft/Yahoo Deal Privacy issues will be central to the forthcoming antitrust merger review of today’s $44.6 billion bid by Microsoft Corp. for Yahoo Inc. U.S. antitrust authorities have already studied these privacy issues in connection with the proposed merger of Google Inc. and DoubleClick, which is still under review in Europe. U.S. and European authorities will almost certainly investigate the privacy aspects of today’s proposed merger more fully than any other merger in history. Although more issues may emerge over time, the market for search looks like it will be the focus of privacy issues of the proposed Microsoft/Yahoo merger. The two companies are probably No. 2 and No. 3, respectively, in the enormous global market for search. The companies will likely argue that their merger will make them a more effective competitor against market leader Google. The privacy concern is that the merger could reduce competition for privacy in search. We have seen major privacy initiatives in search engines in the past year. Microsoft announced new privacy protections last fall. Google did the same during the merger discussions. And the fourth-largest search company, Ask.com, recently rolled out its "AskEraser" privacy-enhanced search. Antitrust authorities thus need to investigate the effects on competition for search privacy from the proposed Microsoft/Yahoo merger. Based on the Commissioners’ statements in the Google decision, it seems highly likely that the FTC would conduct that investigation if it reviews this merger.

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