Google, Yahoo! Step Up Search-Deal Defense

He also argues that neither Yahoo! nor Google has made it clear who among advertisers will benefit from the deal. Will it be better for 5% of the industry or 95% of the industry? No one knows.

"The reality is that it might not lead to any improvement," Liodice says. "When I spoke to Yahoo!, they said the deal needs to be understood on conceptual grounds. Google and Yahoo! have not been descriptive enough to see who will be positively affected."

He also questions what bets Google is making by entering this deal.

"Yahoo! says it will invest and compete and wean off the ads," Liodice says. "If Google knows this, why would they cede to a competitor that will be used against itself longer term?"