WASHINGTON — Antitrust regulators scrutinizing the online advertising deal between Yahoo Inc. and Google Inc. are sure to hear from worried Internet advertisers, public interest groups, lawmakers and one well-connected competitor -- Microsoft Corp.
The deal to link the world's top two search engines faces tough examination from the Justice Department, analysts said Friday.
But Yahoo and Google are optimistic that the government will approve their pact, in which Google's text ads will accompany some of Yahoo's search results and Web pages. Analysts said the companies had clearly structured their relationship to maximize the odds it would pass antitrust review.
They limited it, at least initially, to the United States and Canada, avoiding the tougher antitrust review of European officials. The deal isn't exclusive, so the companies are free to strike similar partnerships elsewhere.
And although Google and Yahoo don't need pre-approval from the Justice Department, they are delaying implementation for at least 3 1/2 months to give regulators a chance to review the plans.
"I think that they certainly understood there was going to be regulatory concern worldwide, and in that case better to have some small steps rather than roll it out big-time and face all kind of objections," said Blair Levin, an analyst at brokerage Stifel, Nicolaus & Co.
But having to use such a strategy shows that the deal faces a tough road, Levin said.
Google Senior Vice President Omid Kordestani laid out detailed arguments for why the deal should not be halted. Although Google and Yahoo sit atop the search engine heap, he said on Google's corporate blog, the ad deal was no different from similar arrangements in other businesses that haven't been blocked.
"Toyota sells its hybrid technology to General Motors, even though they are the No. 1 and No. 2 car manufacturers globally," he wrote. "Google and Yahoo will continue to be vigorous competitors, and that competition will help fuel innovation that is good for users."
Google general counsel Kent Walker said in an interview that the company was confident the Justice Department would give its blessing. But Google and Yahoo wanted to make sure officials had enough time to review the arrangement, given the questions they had when the companies ran a two-week test of their plan this spring.
A Justice Department spokeswoman would not comment.
