Yahoo bid pits 2 titans in lobbying war
WASHINGTON — After sparring for two years over antitrust issues, Microsoft Corp. and Google Inc. are preparing for the main event: a lobbying showdown over the fate of Yahoo Inc.
Google, which has bulked up its presence in the nation's capital, has started raising concerns about the antitrust implications of Microsoft's proposed $44.6-billion takeover of Yahoo. Analysts said it could ask regulators to stop the deal.
At the very least, Google could try to get conditions placed on the deal or delay approval until a new federal administration that may be less friendly to corporate mergers takes office in January.
"This is going to be a hard-fought battle," said Robert E. Litan, a senior fellow at the Brookings Institution and an antitrust official in the Clinton administration.
One battleground could be Capitol Hill. Congress has no formal role in approving corporate deals, but it can spotlight them by holding hearings, potentially delaying regulatory action. Key lawmakers are already expressing concerns about a loss of competition on the Internet and its effect on users' privacy. Microsoft has begun reaching out to them and to consumer advocates.
The House antitrust task force will hold a hearing Friday, and the chairman of the Senate's antitrust subcommittee has promised to do the same if Yahoo accepts Microsoft's offer (Yahoo's board of directors says it's weighing its options). On Tuesday, leaders of the House panel on commerce, trade and consumer protection said they planned to look into competition in the growing online advertising field.
But Google faces an uphill battle in Washington in its effort to prevent a Microsoft takeover of Yahoo, analysts said.
The Bush administration has tried to stop few major mergers. Plus, antitrust regulators pay more attention to complaints from a corporation's customers and the public than to objections from companies that would benefit by preventing their rivals from joining forces.
Microsoft learned that lesson when it lobbied hard last year to stop Google's purchase of online advertising firm DoubleClick Inc. The Federal Trade Commission approved the deal anyway, and the European Union appears likely to do the same.
