Last week's $45bn acquisition bid by Microsoft for Yahoo certainly gets you thinking.

I guess many of us saw it coming but, for me at least, not just yet. Now that I’ve stopped kicking myself for not buying shares in Yahoo, it’s time to start envisaging what the impact would be on search marketing, particularly in the UK.

First things first; if successful, the deal would be completed in the second half of the year - but I would anticipate a lengthy period of integration so there would be little impact on advertisers until 2009.

From that point on, the future is far from clear. This is not exactly a match made in heaven

Both search engines are struggling to keep up with the Big G, particularly in the UK. Google has a near 80% of all UK searches and is going to take some knocking down. 

Ultimately, the partnership needs to deliver significantly more users and searchers to increase revenue for Microsoft and that’s not going to happen just by joining forces. They need more then the sum of their parts.

It also certainly isn’t obvious what Microsoft would do with the Yahoo brand. The recent push to promote the Live brand may suggest that it won’t drop it, but surely it will. 

Yahoo is stronger and to keep Live live, so to speak, as well as MSN, would seem just too many search brands in the pot.

As well as this branding hurdle there’s also the small matter of culture

So far, the main talk has been about combined numbers and engineering resource but Microsoft shouldn’t underestimate the challenge of cultural fit.

A very different story - but cast your minds back to when Findwhat acquired Espotting

The more entrepreneurial Espotting clashed big-time with the more old school Findwhat and this is seen as a key factor in the dwindling fortunes of MIVA.

The talk of enhanced innovation through mix of engineers makes sense, but for that to happen, the cultures of Yahoo and Microsoft need to gel and correspondence to date doesn’t bode well. 

One interesting aside is that this move thrusts Ask into third place. Who knows, with Microsoft and Yahoo focusing on making their brands, offerings and cultures work together, we could begin to see Ask gaining ground

Add that to the fact that we’re seeing some good innovation from Ask, and this could actually be a shrewder acquisition target for someone, maybe from outside the GYM big

Matt Brocklehurst is the head of marketing at Latitude .  


Published 4 February, 2008 by Matt Brocklehurst

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Comments (3)



If this happens, it may also increase Google share of the market, due to many Yahoo users being anti-Microsoft?

over 10 years ago

Richard Hartigan

Richard Hartigan, Industry Manager at Google

I believe that the key reason for the two organisations to join together is to use their combined resources to take greater steps in the great Google chase.

Let's face it, they are both very much behind when it comes to successful deployment of useful and profitable innovations. MSN are very much trying to emulate Google but by spreading themselves too thinly, are doing a lot of things poorly rather than one thing well. Yahoo! meanwhile failed to convince advertisers that Panama was "a new concept in search marketing" and did not back it up with sufficient resources and service delivery.

In my opinion, if both organisations actually focussed on their core prouduct, they would not have to consider such dramatic action. Paid search advertising has remained Google's cash cow for some considerable time now, allowing them to invest time, money and resources in more innovative products.

Bizarrely enough, for anyone that knows me, I believe the answer may lie in offline promotion. From a consumers perspective, there is certainly less difference than in previous years when using any of the big three search engines, especially when conducting fairly rudimentary searches. So why don't they tell people about what they do offer?

Consumers find and use Google too easily and need a reason to search elsewhere. Small search engines such as Blingo have begun offering incentives for users to search with them but this is unlilely to work on a larger scale. For me, MSN and Yahoo! need to go back to the basics of permission marketing. Perhaps Yahoo! should give one of their old employees a call.

over 10 years ago


PPC Management

I suggest Ask could be a target for Rupert Murdochs News Corp.
Kaya, Internet Marketing Manager at Optimised Media

over 10 years ago

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