Is Microsoft-Yahoo’s affair about everything but SEM?
Posted by Riccardo Campaci @ April 1st, 2008 in Marketing Analysis
Everybody knows what could be the most important acquisition in the last 20yrs. in tech business. Microsoft does want Yahoo! and has offered the Sunnyvale-based company a terrific amount of about 44 billion dollars. The “official” reason behind Microsoft’s attempt is that it wants to join forces with Yahoo! to build an effective alternative to Google in search engine marketing.
However, official statistics tell us that, even together, a future “MicroHoo” cannot really compete with the Big G, and even though in the Web companies can rise and fall within a short period, many could agree that, concerning the search engine marketing, Google is the champ. According to last comScore ranking, Google alone had about 60% of the search engine market and its numbers are always growing, whilst Yahoo! and MSN are losing ground month by month.
So, what now? Do we see any white flags waving? Not at all: advertising online is not just about search engine marketing.
As you can see, the evolution of this market is pushing new technologies and new solutions, creating new business opportunities and new tools; the real challenge is not to keep on chasing after Google, being stuck on SEM market, instead the real challenge is to find out what the market of the future will be, like Google did when it first released AdWords, overturning the search engine marketing industry.
The market of the future could be the “networking-market”, a market build on connections, maybe an evolution of the old concept of portals but, this time, built on content, particularly on user generated content, including video ads, animated Flash banners or new online media experiences.
With no doubt, in this field a Microhoo could become a very powerful entity, as stated by Frank Rose on Wired:
[Yahoo] is the world’s most popular Internet publisher, delivering Web pages to nearly 140 million people a month in the US alone. Yahoo also delivers ads to a vast network of independent sites, increasing its advertising reach to 85 percent of US Internet users, according to comScore. Microsoft reaches 56 percent of the US Internet population through MSN and Windows Live, but it still lacks credibility with Madison Avenue. Put it together with Yahoo, however, and you have a scale that even Google can’t match.”
As we underlined some days ago, it seems that the trend of online advertising business is slowly shifting from search to content, and the recent slowing down of Google Adwords revenue reflects the fact that in February 2008, the AdWords clicks (paid clicks) fell down compared to January, and rose up just 3% compared to the same period the previous year. The advertising scene is continuously renewing itself and we are sure that, whether the next online era will be led by “MicroHoo” or by a new reality born in a garage, next year’s market is going to be more interesting than ever.
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