Google (GOOG), for its part, continues to claim its pact with Yahoo (YHOO) is beneficial to competition, and seems prepared to go through with it. “While there has been a lot of speculation about this agreement’s potential impact on advertisers or ad prices, we think it would be premature for regulators to halt the agreement before we implement it and everyone can judge the actual impact,” the company said after the Association of National Advertisers sent a letter to the Justice Department opposing it. Of course, the flip side of that is that it might be premature for Google to move ahead with the agreement before regulators say they’re comfortable with it. Said Stifel Nicolaus analyst Blair Levin, “it would be risky … to proceed if they are getting signals that the agency has serious concerns.”

In a letter to the U.S. Department of Justice, the ANA objected to the Google-Yahoo partnership, arguing that it “will likely diminish competition, increase concentration of market power, limit choices currently available and potentially raise prices to advertisers for high-quality, affordable search advertising.” An understandable concern, considering that Google (GOOG) and Yahoo (YHOO) combined sell more than 80 percent of U.S. search ads, and more than 70 percent of that business is Google’s alone.

But not particularly understandable to Google, which likes to portray the alliance as some sort of enhanced AdSense deal that will make advertising on Yahoo more effective and Yahoo itself a “stronger competitor.” Unfortunately for Google, the ANA doesn’t share that view. Said Robert Liodice, ANA president and CEO, “We believe that the overall impact of this deal is a negative for advertisers and the marketplace.” A harsh indictment and one difficult for Google or the DOJ to shrug off when its coming from a group of companies that spend over $100 billion annually in advertising.