Microsoft  and Yahoo were supposed to have signed a final deal for their joint advertising venture on Oct. 27, but that deadline came and went without an agreement. The companies told the Securities and Exchange Commission in a filing, "Given the complex nature of the transaction, there remain some details to be finalized." The statement added: "The parties are working diligently on finalizing the arrangements, have made good progress to date, and have agreed to execute the agreements as expeditiously as possible."
Does the delay mean there's some trouble in the unlikely marriage of the two competitors? Probably not, notes Greg Sterling, whose firm, Sterling Market Research, focuses on search-engine marketing. "There are a lot of details to be worked out, there's a lot at stake in getting this done," he explained. "The parties are likely still trying to work out some thorny issues."
Picking Out 'Thorns'
What kind of issues might prove to be "thorny"? For one thing, there may yet be confusion over who owns what clients. "Yahoo is going to sell these big accounts, but it will be Microsoft's AdCenter platform that delivers the ads," Sterling said. "Any agencies doing self-service will go directly to Microsoft, even though they may be representing Yahoo clients. This may be where there's some areas of conflict."
Another potential problem area may be mobile search. When the deal was announced in July, cooperation between the companies was left open-ended, Sterling said. Yahoo was to have an option but not a requirement to use AdCenter for mobile search.
"Mobile is now regarded as much more important than it was even a few months ago," Sterling said. "With all of the stuff around [Google's mobile operating system] Android, Google is consolidating their undisputed leadership of mobile, so both Yahoo and Microsoft may be scrutinizing mobile more closely."
Ask on the Block
Meanwhile, Barry Diller has fueled speculation that Microsoft might want to pick up Ask.com. Speaking to Wall Street analysts, Diller, whose IAC/InterActive bought Ask.com in 2005, said the search business is "challenging" and the future "speculative," Reuters reported. Asked if he would seek to consolidate the search business, Diller said, "The answer is yes. And it is unlikely that we would be the consolidator."
"Right now, Microsoft wants share, so they could pick up those points from Ask," Colin Gillis, an analyst at Brigantine Advisors, told Reuters. "Plus it has a double impact since Google powers Ask's paid search."
Sterling agreed that a deal for Ask might make sense. "Ask would give Microsoft some incremental volume and share -- then it just becomes an Ask-branded version of Bing," Sterling said. "The question is what's the cost?"
It didn't have to be this way. Ask.com (formerly Ask Jeeves) once led the way in search innovation, Sterling said, only to see its fortunes plummet under Diller.
"Diller has only himself to blame," Sterling said. "Ask was really the first to do something dynamic with 'blended' or 'universal' search. It was really Diller's failure to invest that caused Ask not [to] be able to realize its potential. Maybe they didn't have the resources, or maybe Diller underestimated the costs."
|
Rackspace: It makes a difference when you focus on support.
House Lawmakers Push Ban on Peer-to-Peer Software
GAO: Los Alamos Computer Security Has Weaknesses
Computer Security Firm Fortinet Plans IPO This Week
Flat Shipments Hurt Dell Despite Increased Earnings
New Pogoplug 'Personal Cloud' Does Social Networking
Apple Tablet Rumored Delayed as Publisher Gears Up
Smartphones: A Bigger Target for Security Threats
FBI Says Hackers Targeting Law Firms, PR Companies