Microsoft's plan to defeat Yahoo-Google merger in Japan

When Yahoo Japan announced that they would be partnering with Google, entering into a deal that would put Google in a dominating position in Japan’s search market, Microsoft was understandably bothered. Aside from the fact that Microsoft, one of Google’s primary competitors in the US search market, had partnered with Yahoo US in an effort to dampen Google’s stranglehold on search market share, there is the 600-pound anti-trust gorilla in the room as well. Microsoft already publicly denounced the partnership, but now they’re coming forward with evidence that shows a Google-Yahoo partnership effectively owning 98% of the Japanese search market. This number is important because regulators struck down a previous partnership between Google and Yahoo US over anti-competition issues when they would have controlled less than 98% of American search market share.

According to Business Insider, Japanese regulators don’t seem to be worried about it. Takahide Matsuyama, executive secretary of Japan’s FTC, said

"In the U.S., the concern was that the companies would go from advertising competitors to collaborators. If they continue to compete for advertisers, the issue of changing your search engine is not an anti-trust problem."

Ted Hennebary, anti-trust expert and senior partner at Orrick, Herrington & Scuffle, thinks that Microsoft has a case. He’s surprised that Japanese regulators are being relatively nonchalant about the issue, and that "In most jurisdictions, this deal would raise very serious and substantial competition concerns."

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