Google-Yahoo deal could bring 20% jump in keyword costs

Search engine marketing costs could be set to rise under the new Yahoo-Google tie up, according to research.

A study by SearchIgnite, found that the price of keywords could see overall increases of 22 per cent.

However, it warns that the most popular keywords could see price rises in excess of the 22 per cent estimate.

Roger Barnett, president of SearchIgnite, told the New York Times Bits blog that reduced competition is one of the most prevalent concerns among its clients.

“Broadly, our clients feel that…more competition in the industry is better for them,” he remarked.

This view echoes that of Brad Smith, Microsoft counsel, speaking at the recent Google-Yahoo search deal Congress hearings.

Following the digital marketing merger, Google will be in control of 90 per cent of the market.

Brad Smith said: “Never before in the history of advertising has one company been in the position to control prices on up to 90 per cent of advertising in a single medium. Not in television, not in radio, not in publishing.”