Sparks Fly as Yahoo, Microsoft Take to Hill

Yang admitted deal with Google would hurt competition: Microsoft
By Kevin Spak,  Newser Staff
Posted Jul 16, 2008 11:08 AM CDT
Yahoo Chief Executive Jerry Yang, right, accompanied by General Counsel Michael Callahan, testifies on Capitol Hill in this Nov. 6, 2007 file photo.   (AP Photo/Dennis Cook, file)
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(Newser) – Congressional hearings on Yahoo's proposed ad deal with Google got a little heated yesterday, with a Microsoft lawyer testifying that Yahoo CEO Jerry Yang recently admitted, in a private meeting, that the pact would reduce competition, the Los Angeles Times reports. Yahoo’s general counsel said he recalled no such remarks at the meeting, and a spokesman later swatted the charge aside.

The Justice Department is looking into the ad deal, as are a number of state attorneys general; Yahoo and Google say they'll pause for the investigation. The hearing, mainly a legislative formality, became a tug of war between Google and Microsoft, with Google and Yahoo arguing that a Microsoft/Yahoo merger was an even more troubling prospect than the Google/Yahoo alliance.