Archive for August, 2010

Yahoo Bing Merger Official 1

Yahoo and Bing have finally merged their organic searches and pay per click campaigns.

Yahoo! says it has finally integrated its search function with Microsoft’s Bing, part of the deal that the two companies set over a year ago. The two search engines will essentially become one. That will make it more likely that the combined entity can challenge Google and save Yahoo! R&D money.

In July 2009, Yahoo and Microsoft signed a 10-year deal that calls for Microsoft to provide the back-end technology powering search on Yahoo’s websites, in a bid to create a strong Number 2 search entity to compete with Google.

Shashi Seth Senior Vice President of Yahoo! Search Products wrote that “I am proud to announce that the transition of organic search between Yahoo! and Microsoft is complete.” In turn, Microsoft’s Satya Nadella – Senior Vice President, Online Services Division said “Bing is powering Yahoo!’s search results in the US and Canada (English only for now, the other languages will come in the weeks and months ahead).”

The combination of the search ad platforms of the two companies has officially taken place and users are now seeing a message in their Yahoo and Microsoft AdCenter accounts.

Wall St. does not seem to think much of the deal, which seemed promising when it was first announced. Yahoo!’s revenue has stalled. The firm has been able to cut some costs because of the arrangement, but those benefits are now priced into the company’s stock which has fallen about 15% this year. There has been speculation that CEO Carol Bartz may be in trouble, but that is highly unlikely. Yahoo!’s board members have to ask whether any other leader could have done better given the nature of the firm’s business. The answer is probably not.

Since the partnership was signed, Google has gotten more powerful, not just in the US but also overseas. Google’s search share in America is between 65% and 70%. It holds similar market share in most countries in Europe. Google is a distant second in market share in China to Baidu, but it did not leave the market as some assumed it would after a dust up with the Chinese government earlier this year. Google may not have the market share it would like to, but Microsoft and Yahoo! have nearly none in the world’s largest internet market. Google has also set a deal with the owner of Yahoo! Japan which will extend its reach in that Asian nation.

And, two other huge markets–India and Russia–have search markets that are dominated by local products. In Russia that company is Yandex, and in India it is Rediff.

Bing is not only in a difficult position in the US. It is also flanked in most large countries around the world.

Google Offers Phone Service via Gmail 3

Google Offers Phone Service via Gmail to compete directly with Skype

The service allows users to make calls to landlines and mobiles from inside their Gmail account.

Phoning anywhere in the US and Canada will be free until the end of the year, while calls to the
UK, France, China and Germany will cost 2 cents a minute.

Until now Google offered computer-to-computer voice and video chat services.

“This is a real big deal because now hundreds of millions of Gmail users can make phone calls right from their Gmail page,” Craig Walker, product manager for real-time communications told BBC News.

“They don’t need to download an additional application or anything to start making really high-quality low-cost calls. For the user it means much more efficient and low-cost communications.”
The product will initially be rolled out in the US; the firm said however, for a brief time, international users were also able to use the feature because of an error.

“Unintentionally we briefly made the service available to non-US English users,” a spokesperson said. “We do hope to bring it to our international users soon.”

When it rolls out the link will appear on the left hand of the Gmail page within the “chat” window. A “call phone” option will pop up along with a number pad to let you dial the number of the person you want to talk to.

Google said money raised from international calls will pay for the free US and Canadian calls.
“What surprised me was that they actually said they hope to make money off the calls,” said Danny Sullivan, editor-in-chief of technology blog SearchEngineLand.

“Normally Google is like ‘We don’t know how we are going to make the money’ or ‘We will make money down the way, don’t worry about it’ and this stands out as a big benefit that they get actual revenue early on.”

Competition with Skype

Skype, which is the most successful internet phone offering, claims to have over 560 million registered users. The firm said 124 million used the service at least one a month while 8.1 million were paying customers.

The company is planning to offer shares to the public later this year. Observers said that it is too early to say whether companies like Skype should be worried.

“Skype is a well known company in this place and they are almost like a verb in the internet calling world in the way Google is with search. You Skype someone. So I think there is some inertia there to get over and I am interested to see how Gmail users respond,” said Tom Krazit, senior writer with technology news site CNET.com.

“But you always have to worry when Google comes after what you do. They don’t do things half way and bring a lot of resources to any problem they try to tackle. It doesn’t mean you are doomed.

“Google’s product won’t work on your mobile browser so Skype has an advantage there but I don’t think it is a stretch to assume Google will come out with a mobile version pretty soon,” said Mr Krazit.

The company plans an eye catching way to get non-Gmail users to give the product a green light. It is in negotiations with a number of university campuses and airports to install red telephone boxes around the country to give users the chance to dial and try.