Competition can "produce more revenue" for Google

Google Inc. (GOOG.O: Quote, Profile, Research) faces mounting competition in the Internet search advertising market, but expects such competition to drive up prices and increase revenues across the entire industry, Chief Executive Eric Schmidt said on Wednesday.

I agree that is the case in competitive bid terms, but I'm not entirely convinced it will help in the case with the two big names mentioned. It may increase spend slightly, but I'd say that it's diluting the budgets as there is normally only so much in the pot.