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A Yahoo! Inc. [YHOO] move to outsource its search advertising to Google Inc. [GOOG] would likely ring alarm bells not only among regulators in Washington, but also with privacy advocates.

Jeff Chester, executive director of the Center for Digital Democracy, says the group would urge antitrust enforcers to closely scrutinize a search deal between Yahoo! and Google and intensify their focus on Internet industry consolidation. The Center "would ask regulators in the U.S. and European Union to investigate any alliance between Google and Yahoo!, such as an extension of the trial on a permanent basis," he says by email. "If Yahoo! is 'off-shoring' part of its search service to its principal competitor--Google--it is no longer really a meaningful competitive force. We also would raise critical questions about any Microsoft and Yahoo! deal as well." -- Alain Sherter

For more on the alliance between Yahoo! and Google see paidContent, BloggingStocks, The Wall Street Journal and Search Engine Land

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