Now that Microsoft has withdrawn its offer to purchase Yahoo!, the No. 2 search engine has started looking for other opportunities, one of which is to run Google AdSense ads on its network of websites. If that happens, what would that mean for Google AdWords advertisers?
First, it would mean that Yahoo! Search Marketing is bowing gracefully out of the PPC advertising market and that would leave a large number of advertisers in that network out in the cold. They’d have no alternative but to start using Google AdWords as their primary source of PPC advertising, if they aren’t already. It is not likely that many of them would migrate over to MSN Live, though some may.
But the real issue for advertisers would be the price of clicks in Google Adwords. The additional demand and competition for key advertising terms would drive up click prices in a heart beat. That in turn would lead to greater revenues for Google AdWords and Yahoo! This is no doubt what both companies are hoping for.
An antitrust lawsuit might eventually lead to Google AdWords being spun off as a separate company from Google, but it would still remain that advertisers would be paying more for clicks. The big question would be how Google AdWords would improve its services for its advertisers in the long term.
