Calif. AG urged to probe Yahoo-Google ad deal

A California assemblyman has urged the state's attorney general to investigate privacy implications of Yahoo's search-advertising deal with Google.

Joel Anderson, a Republican assemblyman from San Diego

(Credit: Joel Anderson)

"I am writing to urge you to direct your office to take quick and decisive action by launching a formal investigation into the proposed business transaction between Google and Yahoo's search-advertising business," Joel Anderson, a Republican assemblyman from San Diego, said in the letter to California Attorney General Jerry Brown.

Attorneys general from Florida, Arkansas, and Connecticut are reviewing the Yahoo-Google ad deal. The Justice Department also is scrutinizing the partnership.

Specifically, Anderson said he's concerned that the deal will give Google a lock on the search ad marketplace, thus eroding searchers' privacy.

"The impact of such potential market concentration--in both Internet search and search advertising--left in the hands of one company, at the very least, warrants rigorous scrutiny. We must ensure that the proper consumer safeguards and transparency are put in place to protect privacy," he said in the letter, sent July 18 and released publicly Tuesday. "The ability to 'data mine' online behavior in order to find specific consumers interested in specific products is a big part of Google's revenue stream and business plan. If Google is allowed to control over 90 percent of Internet searches, those data-mining capabilities will be unmatched and will soon make it impossible for any competitor to crack Google's stranglehold on Web advertising."

Yahoo, Google, and the California attorney general's office didn't immediately comment on the letter.

Update at 12:52 p.m. PDT: Yahoo said the privacy concerns were off base. "Both companies have taken important steps in this agreement to ensure that user privacy is protected," the company said in a statement.

"Any suggestion that Google and Yahoo are merging vast databases of personal information is simply false. While we may share some search terms to obtain sponsored search results from Google, we will not share personal information about our users without consent," Yahoo said. And the company will remove the last quarter of a searcher's Internet address before handing the search term to Google, Yahoo said.

Yahoo has a financial incentive to ensure that users trust the company, Yahoo added: "The Internet-advertising model does not work without the trust of our users--most of what we do is offered to consumers for free, and users can leave at any time. We can only succeed if our users trust us and our privacy policies."

Update 2:53 p.m. PDT: Google has weighed in with a similar view to Yahoo's:

"Google takes privacy very seriously and has structured the agreement to provide ads through Google's AdSense program in a way that ensures that personally identifiable information of individual Internet users will not be shared, combined, or merged by the companies. We have designed it so that both companies have stayed within existing privacy and data policies, such as Google's policy regarding logs anonymization after 18 months," the company said in a statement.