Micro-Hoo: Thoughts Part 2

The deal’s big winner is Microsoft, which makes no upfront cash payment and gets Yahoo!’s reach now for its advertisers. Yahoo! wasn’t compelled to do this deal but perhaps the board and the market pressure was too much.

Yahoo! gets some revenue guarantees, access to search data (for BT on other properties) and doesn’t have to invest many resources in search going forward. Longer term, however, this is probably not a good deal for Yahoo! but we’ll see.

Stock is down right now:

Picture 31

There are lots of open questions:

  • What happens to SearchMonkey and similar initiatives, etc.?
  • Microsoft and Yahoo! have said they’re still competitors. How will that affect the execution of this deal?
  • How does this affect Yahoo!’s newspaper relationships?
  • What happens to specialized vertical search on Yahoo! properties: Local/Maps, News, Real Estate, etc.?
  • How will the anti-trust arguments play out? In my mind there are legitimate anti-trust arguments to be made but they’re unlikely to succeed. EU scrutiny will be tougher than US.
  • What happens in 10 years when the deal is up?

Your thoughts?

10 Responses to “Micro-Hoo: Thoughts Part 2”

  1. Gene Daly Says:

    Wall Street doesn’t like it… I guess that “boatload of cash” Carol Bartz was expecting didn’t sail in. She set some pretty high expectations.

  2. Tim Cohn Says:

    Here are three:

    They beat her like a cheap drum.

    Darwin would be proud.

    Embrace, Extend and Eviscerate.

  3. earlpearl Says:

    From the perspective of local search I think its a positive. In my experience the biggest issue with local is the dominant position of Google Maps within google.com for searches that are either directly local (ie Long Island dentists or implicitly local, such as Dentist when the searcher is located in Denver, Long Island, or anywheres else). As you reported earlier Greg, and Bill Slawski later reported, approximately 50% of the searches for local products or services are made without a geo modifier.

    From a business and consumer perspective the seemingly increasing number of errors, mistakes, and hijackings in google maps is creating an ever larger number of problems.

    To date Google refuses to deal with these issues. They offer no customer service.

    A more dominant competitor might well change that landscape. I think that is a big plus. Frankly the visibility of google maps in google.com searches so outweighs all the revenue sources and usage of verticals….that they may start to hemorage money over time.

    I look forward to a more vital competitor in the search world. I would shudder to think that there would be anti-trust issues with regard to search in combining Yahoo and Bing. There is no issue there. Currently Google is the awesome kahuna and everyone else is a small potato.

  4. Greg Sterling Says:

    Thanks Dave . . . the customer service angle is interesting. I hadn’t been thinking about that.

  5. Tim Cohn Says:

    Dave? Dave’s not here…

    Who is Dave?

    Greg I believe I have a great question for you to ask the new #2 search engine when and if you get a chance:

    Will Bing insource adCenter now or will they continue to outsource advertiser customer support to a third party like they are now?

    http://searchmarketingcommunications.com/2008/11/13/and-microsoft-wanted-to-buy-yahoos-search-business/

  6. Greg Sterling Says:

    Tim:

    I suspect they’ll continue to do what they’re doing, but I’ll try to find out.

  7. Tim Cohn Says:

    Thanks… Being an old guy like me I was wondering if you got the Dave reference?

  8. Greg Sterling Says:

    Cheech and Chong, of course. I’m over 40🙂

  9. Tim Cohn Says:

    I wasn’t sure but now I am LOL now!

  10. emad Says:

    http://developer.yahoo.net/blog/archives/2009/07/developer_update.html

    “For SearchMonkey and BOSS, we currently do not have anything concrete to tell you. Clearly, we’ll need to work with Microsoft to determine what makes the most sense for you and for us.

    When we have new information to share about SearchMonkey and BOSS, we’ll be sure to let you know.”

Comments are closed.


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