The Yahoo! /Google Connection
Thursday, June 12, 2008SUSIE GHARIB: Microsoft and Yahoo! ended their merger talks for a second time today and tonight, Yahoo! has inked a new deal with Google. Microsoft and Yahoo! walked away from the negotiating table earlier today with Microsoft saying it didn't want all of Yahoo! and Yahoo! saying it wasn't interested in a partial deal. Now Yahoo! has an online advertising partnership with Google. The two companies are expected to hold a conference call at this hour. We hope to have them later in the newscast. Standard & Poor's equity analyst Scott Kessler says Google's technology would be good for Yahoo!'s bottom line.
SCOTT KESSLER, EQUITY ANALYST, STANDARD & POOR'S: Basically it will enable them to generate more associated revenues and earnings from search queries and it will make them more competitive from the perspective of doing better vis-a-vis search. The bottom line is a deal with Google, it won't enable them to gain share, it won't enable them to gain standing in the search market, but it will enable them to be more profitable and that's pretty important, too.
GHARIB: Kessler expects Yahoo! to announce a major stock buyback very soon, even if it has to raise debt to do it.
