The U.S. Department of Justice has officially approved the Yahoo!-Microsoft alliance.
Microsoft’s search engine, Bing, will provide the search results for Yahoo! enabling Microsoft to have the best chance at taking down industry-giant, Google. The transition in the search results is expected to be completed by the end of the year.
Various reports are stating that the Yahoo! and Microsoft deal from July 2009 is expected to be approved this week by the European Commission. Any opposition to the deal at this point would have to come from the US. So far, the deal has been widely supported.
To recap the deal framework, Yahoo! search results would be powered by Bing including sponsored ads. Yahoo! is relieved of many search associated costs but maintains their brand name, signature look and features. Yahoo! and Microsoft would combine for 28% of the search market share which is still dwarfed by Google’s 65%, but this is still the biggest threat to Google in quite some time.
Google’s commanding share of the search market (71%) has prompted Yahoo! to regroup and add new features to their consumer and advertising platforms. Yahoo has expressed a plan to add video results to their primary search results instead of just keywords and links. Search results will also appear below Yahoo! emails. The results will be related to the email content to some extent. Yahoo! Search Marketing advertisers are now able to import Google AdWords campaign data directly to their Yahoo! campaign.
Yahoo! is certainly struggling with only 15% of the search market in their grasp. With Bing improving the most of late, this percentage could drop even more. While Bing and Yahoo! are still in the midst of a merger that will combine the efforts of both brands to overtake Google, Yahoo! brass still want their brand to be a powerful entity by itself as these improvements show.
Antitrust authorities in Italy are examining Google (Italy) after publishers of news websites complained that the search titan was not giving them a fair share of revenue from online advertising.
The accusers claim that Google does not disclose criteria for ranking content on its news site. Consequently, agencies such as newspapers are unable to maximize the amount of money gained from advertising. Search engines such as Google and Bing actually do give some information regarding rankings, but do not give their entire method in order to avoid complications.
Carlo Malinconico, president of the Italian Federation of Newspaper Publishers, said “Publishers provide much of the content on the Internet, but they get nearly nothing for it….This is not fair, in our opinion. Our feeling is we lose more than we gain.” Newspapers also claim that Google Italy discriminates against sites that do not want to be associated with Google News by dropping them from the search engine completely.
According to comScore, Google controlled 68 percent of all search queries in July, a mere 76.7 billion entries. It still owns nearly 90 percent of searches in Italy. As long as Google continues to dominate the search world, similar antitrust claims will remain common. While the allegations are serious, experts don’t see the probe going far.
Last month’s Microsoft/Yahoo! deal continues to draw attention throughout the search community. The market share of Microsoft’s Bing.com has continued to increase slightly since its June launch, but it is still a far cry from Google’s dominant stance in the industry. It is hard to argue that the deal is not affecting Google; the company has unveiled an update to its search platform. Experts see it as a response to the move, but Google denies such claims stating that the update had been in the works for awhile.
Perhaps the greatest challenge that Bing faces in its fight against Google is search loyalty. Google has simply become a habit for users over time, with most giving little thought to a potential switch. Gord Hotchkiss, CEO of Enquiro Search Solutions, said “For Microsoft-Yahoo to disrupt the Google habit, they have to offer a compelling enough reason to do the cognitive heavy lifting required to break a subconscious habit.” Bing will need to change its casual users into faithful ones.
Microsoft and Yahoo! may also be confronted with antitrust issues as a result of their agreement. The question posed by the partnership is whether or not online advertisers will benefit more with a single, more powerful rival to Google when compared to two less threatening foes. It will be challenging for regulators to make a case due to the fact that the number two and three competitors are joining forces (as opposed to the top two in a market). Legal officials are not expected to complete a review until 2010.
While nothing has changed dramatically since the agreement, competition among search engines is sure to remain strong.
Google has introduced Caffeine, a new and improved version of its search platform (the update is currently available for use under an alternative link). The move is described as an “under the hood” update, meaning that nothing will change externally, and the average user will not recognize much of a difference.
Google Caffeine has proven to be more effective at incorporating recent information such as news stories into its top results. The update has also made Google search slightly faster. In his blog, Google software engineer Matt Cutts reiterated that the update will not bring extreme change: “This update is primarily under the hood: we’re rewriting the foundation of some of our infrastructure. But some of the search results do change, so we wanted to open up a preview so that power searchers and web developers could give us feedback.”
The update may begin to address Google’s challenge to incorporate real time search. Results from social websites like Twitter are more common, but Microsoft’s Bing seems to still have the upper hand in this regard. There have been past talks of Google and Twitter working on a real time search deal.
Experts see the update as a response to the recent Microsoft/Yahoo! search deal, but Google says that the move has been in works for months. Google may control nearly 75 percent of the search market, but it is not about stop working on new innovations. “Nobody cares more about search than Google, and I don’t think we’ll ever stop trying to improve, Cutts said.”
The recent resignation of Google CEO Eric Schmidt from Apple’s Board of Directors has rekindled the idea of Apple building a search engine of its own. Both companies are competitors on various fronts. For example, Google’s Chrome browser competes against Apple’s Safari, and Google’s android operating system for smartphones contends with Apple’s iPhone system.
A major reason tech experts assume Apple is launching search is due to a struggle to obtain a search function on the iPhone. A unique search engine would fit hand-in-hand with Apple’s Safari web browser. Apple may have missed out on an opportunity now that Microsoft and Yahoo! have negotiated a search deal, but the introduction of a new search tool could bring a third party into the race for search superiority.
A change could take users away from Google, which is currently the default search tool for Safari. Many Apple fans would make the switch, which could account for up to five percent of the search market, along with all iPhone users.
Despite the potential gains, Apple Search remains a rumor, as there is little proof of the company organizing a search program. Another possibility is a search engine with results powered by Google. A partnership could make sense. Google already pays Apple from earnings through Safari, and Apple could also use help in advertising.
While Apple does want to improve the search options for devices like the iPhone, the introduction of a full-fledged search engine seems unlikely at the moment. However, the possibility of a search partnership with Google is interesting, potentially giving Google an ally in its battle with Bing and Yahoo! while also certainly brining up antitrust whispers.
