We also think this is good for competition. The truth is, this kind of arrangement is commonplace in many industries, and it doesn’t foreclose robust competition. Toyota sells its hybrid technology to General Motors, even though they are the number one and number two car manufacturers globally. Canon provides laser printer engines for HP, despite also competing in the broader laser printer market. Google and Yahoo will continue to be vigorous competitors, and that competition will help fuel innovation that is good for users.
This quote from the official Google Blog post regarding the recently announced deal between them and Yahoo is spot on.
It is true that this statement was created by a public relations machine and is more of a defense against possible regulators and lawsuits than a promise to the rest of the world. But, if any company was to be truthful in that statement and use this opportunity for competition and cooperation, my bet would be that the people heading Google and Yahoo are crazy enough to make it work.
If not, then at least they have good PR departments, and I’m still a sucker for that.