Efficient Frontier recently released new numbers for search advertising spend that show Google continues to be the market leader with 77.4% of the U.S.’s search advertising spend in the second quarter of 2008. The data tracked by Efficient Frontier includes 23 billion ad impressions and 390 million clicks.

Over the past 12 months Google has been pulling away from Yahoo as they continue to gain shares in ad spending. This is an unfortunate turn of events for Yahoo who had counted on Panama, the ad system launched last year, to help increase the amount of advertising spending within the company. Another aspect of the decline can be attributed to the loss of overall search share, which leads to fewer impressions.

Even with a decline in their share of the search spending pie Yahoo could still earn money as long as the overall spend in search advertising grows. Unfortunately, according to Efficient Frontier, the growth that is occurring isn’t benefiting Yahoo, or Microsoft for that matter. In all actuality Google receives more of the new money as well.

This may sound great for the search engine giant Google, but in actuality it’s likely going to hurt their chances at winning government support for a plan to have some of its search ads carried by Yahoo. Microsoft is sure to fight against a Google-Yahoo deal as a potential monopoly.

While Google continues to dominate the U.S. market it is of worth to note they have a 50/50 split with Yahoo in Japan, which shows some weakness in the giant search engine. Additionally, Google is behind the competition in China, South Korea and Russia.

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