Yahoo and Google ditch ad deal

Negotiations between Yahoo and Google concerning an advertising deal are now off the table, both companies have said.

“After four months of review, including discussions of various possible changes to the agreement, it’s clear that government regulators and some advertisers continue to have concerns about the agreement,” Google chief legal officer David Drummond said in the company blog.

“Pressing ahead risked not only a protracted legal battle but also damage to relationships with valued partners. That wouldn’t have been in the long-term interests of Google or our users, so we have decided to end the agreement.”

The deal would have seen Yahoo bring in more revenue by showing more relevant ads for its search queries. But the group has said it will continue on without a partnership.

“While the implementation of the services agreement with Google would have enabled Yahoo to accelerate its investments in its top business priorities through an infusion of additional operating cashflow, this deal was incremental to Yahoo’s product road map and does not change Yahoo’s commitment to innovation and growth in search,” the company said in a statement.