Three weeks after making a $1.2 billion bid for FAST search & Transfer Microsoft announces that they make a $44.6 billion offer to buy Yahoo. So far it‘s only an offer which Yahoo’s board and stockholders are considering but, to conclude, Microsoft is serious about going into strategic search markets.
Web search engines, such as Google and Yahoo, are making really good money from online advertising such as contextual ads when searching, banners etc. This market is, according to analyst firms such as Yankee group, predicted to double over the next four years giving somewhere between $40- $50.3 billion in revenue.
Google is still a leader within this field, but it seems as if the competition is getting tougher.
Apart from web search there has also been a lot of talk about mobile search, a new emerging market where Yahoo last year made an acquisition of TellMe, a hosted speech applications company. Since this purchase Yahoo has done development for using its online advertising platform Panama for local mobile search and services as well.
If the offer is accepted Microsoft will have a strong portfolio, reaching from critical enterprise search with FAST technology and consumer focused search with Yahoo.
(An interesting perspective is the historical background where FAST developed AlltheWeb, one of the most popular and sophisticated internet search engines in the beginning of 21:st century, which in 2003 was sold to Overture and later bought by Yahoo.)
If the future holds a merger of advanced search technologies remains to be seen, but we will probably see some really interesting development within this field the forthcoming year.
What is your opinion? Can this affect Google’s position as a leader within web search? And more importantly, how do you think Microsoft’s purchases will affect the market for search in general?