Yesterday's deal between Yahoo!
Ever since Google showed an interest in blanketing San Francisco with free Wi-Fi access, it's been a threat to content and access providers alike. Google is assuming that it will be able to monetize the connections through its massive inventory of contextual ads.
BellSouth doesn't pitch its services in California, but it can see the potential consequences. BellSouth relies on a value-added service like broadband connectivity to help beef up its financials, so how can it compete with free? Yahoo!, meanwhile, depends on a growing sea of eyeballs to which it can market its ads, so how can it let Google commandeer the user experience by owning the launch page to the online experience? Naturally, Yahoo! will do what it can to prevent that from happening.
Yahoo! doesn't mind being overly generous if it makes BellSouth's product more attractive. The package bundles many of Yahoo!'s premium services into the existing BellSouth pricing options. For instance, the same Yahoo! Mail Plus upgrade for which Yahoo! charges folks $19.99 a year will be part of the partnership's offering.
Other perks, such as premium Internet radio and other customizable offerings, will also be included. The move creates value in the DSL connection and also keeps Internet users away from Google ... initially, at least.
Access providers are trying to vanquish Google before it becomes a full-blown hydra. In a case of "if you can't beat 'em, join 'em," Comcast
Something tells me that in a few years, some of the history books will be rewritten with "Google" as the answer to what unfolded. As for why Yahoo! hooked up with BellSouth, that answer is already in place.
Longtime Fool contributor Rick Munarriz does not own shares in any of the companies mentioned in this story. The Fool has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.