Google, Yahoo search ads tie up a success?

Leaked reports are suggesting that Yahoo and Google are getting on famously and their search advertising test is proving successful.

by Helen Leggatt

Yahoo and Google’s search advertising tie-up appears to be going very well. The Wall Street Journal is reporting that “people familiar with the matter” are calling the test a success after initial results were promising.

"It's nice working with Yahoo and we like them very much," said Google’s Chief Executive, Eric Schmidt.

Citigroup Global Markets analyst Mark Mahaney believes a Yahoo-Google deal could increase Yahoo’s cash flow by more than $1 billion a year as Google generates more revenue per search query than Yahoo.

Meanwhile, Microsoft and Yahoo are due to meet again this week after the last two talks failed to move that deal forward.

So far, neither Yahoo nor Google have officially commented on the deal and any future outcomes.