Home > News and Views > Newsletter > April 2008

LBi Netrank Newsletter: April 2008

Microhoo! delays, Yahgle! ads partnerships, new analytics offerings, recdent searches, Alexa updates, Google Ads spending exceeding TV, BBC iPlayer and, of course, Trademark.

Acquisitions and Partnerships

• Microsoft fails to acquire Yahoo!

  Microsoft withdrew its bid to buy Yahoo! because the companies could not agree on an acquisition price. It was reported that Microsoft offered a deal of $33 per share, but Yahoo! would only consider $37 or above.

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• Google and Yahoo! form alliance over shared ads

  Google has had access to 3% of Yahoo! Ad space for a two week test, with a potential long term partnership on the cards. Microsoft is not too keen on this new venture. The plan is to upgrade Yahoo! marketing customers and then offer the technology to third party developers.

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• Microsoft buys travel search engine Farecast

  Microsoft has bought Farecast, a travel search website that finds flights for you. It is estimated that Microsoft bought the site for between $75 and $115 million.

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• Yahoo! buys analytics company IndexTools

  Yahoo! is looking to get in on the analytics game by acquiring IndexTools. Yahoo! currently only offers the blogging format MyBlogLog and an analytics tracker for Yahoo! Search Marketing customers.

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• AOL buys contextual search company Sphere

  AOL has not disclosed how much it paid for the company. Rumour has it that parent company Time Warner may sell AOL and is buying up additional services in order to make the ISP more sale-friendly. Sphere uses software that allows content to be aggregated around related subjects such as video, audio and blog posts.

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Search News and Research

• Google announce trademark policy change

  As of the 5^th May, Google has allowed open keyword bidding on all terms in the UK and Ireland. This will allow non-trademark owners to bid for ads on trademarked terms. Hitwise conducted research into the effects of this change, comparing the search results of the UK before this change with the US who have already moved over to the new arrangement. 82% of brand searches ended up at the trademark holders' websites in the US, compared with 91% in the UK at present. Clearly, trademark holders stand to lose out with the introduction of this new policy.

• EU propose data retention time slashes

  An EU advisory body has recommended that search engines should delete personal data about their users after six months. Google and MSN currently remove data after 18 months and Yahoo! does so after 13 months.

  This recommendation, if ratified by the European Commission, could lead to clashes with the major search engines. Whereas the EU body feels that the search companies are not clear on data protection, Google and Yahoo! argue that they are trying to strike a balance between innovation, security and privacy.

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• Online Ad spends to exceed TV in the UK

  Spending for online advertising in the United Kingdom is set to overtake that of television advertising spending by the end of 2009, according to a report by PriceWaterHouseCoopers, the Internet Advertising Bureau and the World Advertising Research Centre. It noted that the UK has the most developed online advertising market in the world, which was valued at $5.6 billion in 2007.

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• Google announces 30% rise in profits

  Google has beaten Wall Street expectations to register a 30% rise in profits during the first quarter of 2008, shrugging off fears about a slowdown in the global economy.

  The company announced that sales had increased by 42%, to $5.19bn for the last quarter. Interestingly, this is the first year that Google has earned more revenue abroad than at home (51% of total sales), partially due to a slump in the weak dollar.

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• Yahoo! first quarter profits triple

  Microsoft has been courting Yahoo! for a very good reason - the company's profits are up from $142.4m last year to $542.2m in the first quarter of 2008. Yahoo! appears to be eager to prove that it is worth more than Microsoft's $44.6bn offer.

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• Yahoo! plays 'social' catch-up

  Having missed the social networking boat, Yahoo! has sworn to start "building social into everything we do".

  Since acquiring Flickr a few years ago, Yahoo! has fallen behind, with other sites leading the way forward. Yahoo! will now be rewiring links between users, taking advantage of the 10 billion latent connections between its 500 million existing customers. All of this information will then be controlled through a single console.

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• BBC clashes with ISPs over iPlayer

  The popular iPlayer is putting a strain on the ISPs' networks, forcing them to upgrade. The BBC believes that ISPs should carry the cost of these upgrades, whereas the ISPs believe that the corporation does not understand the issues involved. According to Ofcom, it will cost ISPs £830 million to acquire the extra capacity needed. Tiscali has suggested that the BBC should shoulder some of the costs.

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• Users Digg YouTube more than any other site

  Data provided by socialblade.com (going back to the 18^th February) shows that YouTube is the most referenced site by Digg users. The BBC, Daily Mail and the Telegraph also feature in the top ten.

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• Best of the Web adds DMOZ editors to their directory team

  Popular web directory Best of the Web (BOTW) has acquired more than thirty web editors from the open directory project. 'The Nerd Herd' will be focusing on architectural improvements and boosting categories with sources that are relevant to them.

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Search Engine Updates

• Google starts crawling web forms to index the Deep Web

  Google has enhanced Googlebot to include basic support for crawling web-based forms. Although this is initially fairly limited in scope, we expect more extensive crawling of forms in the future. This is part of Google's continuing efforts to tap into the "Deep Web", so-called web pages that are often hidden from search engines.

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• Yahoo! Update! And! Slurp! Improvements!

  Yahoo! has reported another update in its search ranking algorithms in April. It has also upgraded its search spider, known as Slurp, to version 3.0. Site owners should expect potential changes in spidering activity from Yahoo!

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• Recent searches to affect search results on Google

  Google is reported to be close to launching a change in the way that its search results are generated, based on what a user has searched for before. While Google already personalises search results for users who are logged into Google and use their "Web History" feature, this new change will affect users who are not logged in as well. When users visit Google and perform a search, the keywords that they used will also apply to their next search.

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• Alexa updates rankings

  Alexa has announced a major upgrade to its rankings system, which ranks websites in order of the number of visitors. Whilst the old system obtained its data just from users of the Alexa Toolbar, which often led to a bias towards SEO-related websites, the new system obtains data from other, unspecified, sources.

  Alexa is claiming significantly improved reliability for its updated site rankings. Large changes in sites' Alexa rankings should be expected.

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New Product Launches

• Google launches App Engine

  Google has launched an application that allows users to build web applications with support for Google technologies such as GFS and Big Table, all hosted by Google.

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• FlickrTube!

  Flickr Pro members can now upload films of up to 90 seconds long, by using the Flickr Video Sharing Service.

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Search Engine Market Share Updates

• Google handles two thirds of US searches, and drives over a third of all visits to UK websites

  According to recent data from Hitwise, Google has a 67% US market share which is up from 64% last year. The bridesmaids include Yahoo! (20%) and MSN (less than 7%). Ask has improved its position somewhat with 4.09%, up 0.5% from 2007, whereas MSN has lost over a quarter of its users in one year.

  As well as having recently achieved a market share of nearly 90% for the UK search market (Hitwise), Google is also now powering over a third of all visits to sites in the UK. 36.55% of traffic to UK sites in March came from Google, an increase of more than 6% from last year.

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• Only 1 in 7 use the "pages from the UK" option on Google UK

  13.6% of users use the "pages from the UK" option on Google UK (around 1 in 7), according to Hitwise. The report states that the number of those using the UK-only option appear to be in decline, but there is not enough data to confirm a long-term trend.

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• Search market share in Russia

  Russian search engine Yandex has the majority of the market share with 47.4%. Google gets the silver with 31.2% with the next most popular western search engine being Yahoo! with only 1.3%. (These statistics exclude traffic from public computers, mobile phones, PDAs or from people under the age of 15. Source: comScore).

  According to Linda Boland Abraham, comScore Executive Vice President, "The Russian Internet market has been experiencing rapid development, with its audience growing 25 percent during the past year.
  Several Russian Internet brands are leading the way, so it's clear that there are strong opportunities for Internet-based businesses as this market continues to expand".

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