Advertising group welcomes Yahoo, Microsoft venture

* Advertiser group says Yahoo, Microsoft deal positive

* Letter signed by 4 global advertising holding companies

WASHINGTON, Oct 19 - A major advertising group wrote a letter to the Justice Department on Monday in support of Microsoft's and Yahoo's plan to work together to challenge dominant search engine Google.

The American Association of Advertising Agencies, in a letter dated Monday and posted on its web site, said it was pleased with plans for the 10-year deal in which Microsoft's new Bing search engine would power queries on Yahoo's sites. In return, Microsoft is to pay Yahoo 88 percent of revenue from advertisements generated from those sites.

The goal of the plan is to challenge Google, which has about 77 percent of the global Internet search market, according to industry tracker comScore's figures for July. Yahoo comes a distant second with 8 percent and Microsoft fourth with 3 percent, behind China's Baidu.

"We believe that Yahoo! and Microsoft's proposal to combine their technologies and search platforms is good for advertisers, marketing services agencies, website publishers and consumers," the advertising group said in a letter signed by Chief Executive Officer Nancy Hill.

"As leading members of the advertising and marketing services industry, we urge the Department of Justice to bring its antitrust review to a speedy conclusion. This proposal enhances competition, and should be allowed to take effect as soon as possible," wrote Hill.

The letter also was signed by the heads of the four big global advertising holding companies: the Publicis Groupe, WPP , Interpublic Group of Companies and Omnicom Group.