Congress Steps Up Questions On Google, Yahoo Ad Alliance

Google and Yahoo defended the partnership as a way to deliver more relevant ads to consumers and more valuable leads to advertisers.

Callahan said the firm plans to use the revenue from the deal to be a more formidable competitor for Google.

"Our incentive is to sell as many Yahoo ads as possible," he said.

Google general counsel David Drummond disagreed that the deal would result in Google's control of the search ad market because Yahoo would still sell its own ads.

"Yahoo is staying in the market and is a competitor going forward," Drummond said. "If Microsoft swallows up Yahoo, one competitor will be gone."

Tim Carter, founder of AsktheBuilder.com, which provides home improvement advice, told lawmakers that a Google/Yahoo partnership would let Yahoo grow its search advertising business and allow small firms like his to reach more people. (Carter writes a column syndicated by Tribune Media Services that runs in The Post.)

"You can buy ads for very little money on all three of these search engines," he said.

Matthew Crowley, chief marketing officer of YellowPages.com, which is owned by AT&T, said the deal would weaken Yahoo and ultimately his business. As he put it: "We'll end up paying higher rates for less inventory on Yahoo."