06/08/2009
Following a lengthy 18 months of discussions, negotiations and plenty of deal thrashing, the Microsoft-Yahoo! merger has reached an influential stage. The two internet giants have agreed a 10 year deal that will see Microsoft’s Bing takeover Yahoo! as a search engine, whilst Yahoo! continues to sell adverts through the search results generated on the site.
The deal, announced on Wednesday, will allow Microsoft to access the audience that Yahoo! has previous accumulated, the second-largest search engine audience on the internet!
This integration provides a would-be weapon for Microsoft as they line up for another bitter battle with ‘Goliath’ search engine Google.
Haven’t Microsoft been here before?
Microsoft has tried, and failed, on numerous occasions to launch themselves as a search engine in amongst the stiff competition. Each of these dismal attempts failed to make an impact on the dominant market share that Google did, and still does possess.
Firstly, Microsoft launched the MSN search engine, which gathered its information from other sources such as Inktomi, Looksmart and AltaVista. However, as Google’s market share continued to grow, Microsoft had to re-evaluate its offering in order to compete.
In 2006, it launched Windows Live Search, the second version of the Microsoft search engine. Despite this, Google continued to steam ahead, which led to the decline of Microsoft’s market share.
2007 saw Microsoft take the decision to split their search engine away from Windows Live and rebrand it under Live Search.
Nonetheless, this made little or no impact on the dominance that Google held. This market trend showed that no matter what tactics Microsoft enforced, they never seemed to make the grade in comparison to Google’s colossal market share.
The line graph below illustrates the online market trend in the UK from 2006 to 2009, and clearly shows how Google has continuously dominated the market within the UK.
| |
2006
|
2007
|
2008
|
2009
|
| Google |
72.38% |
78.28% |
88.50% |
91.27% |
| Yahoo! |
7.04% |
8.58% |
4.09% |
2.50% |
| MSN Live Search |
5.75% |
5.46% |
3.72% |
2.36% |
| Other search engines |
14.83% |
7.68% |
3.69% |
3.87% |
Therefore, this partnership with Yahoo! is being deemed as Microsoft’s best chance of ‘rocking the boat’ in terms of influencing Google’s dominance.
Whilst many think that, despite this newly-formed partnership, Microsoft and Yahoo! will still be dragging their heels behind the unstoppable force that is Google, others believe the merger of the two elite organisations will make Google stand up and take note, and perhaps induce attempts to strengthen the search engine as a brand.
How will the merger affect the UK market?
Despite maintaining that it is, and will continue to be, the biggest and best search engine facility, it would be narrow minded of Google not to assess what threat, if any, this merger will pose on their future.
Once the merger is complete, which is said to happen in early 2010, Bing will hold a 4.86% market share. This impending competition, along with Bing’s massive marketing budget, may encourage the experts at Google to improve the speed and efficiency of their service.
The idea of ‘healthy competition’ is welcomed by many in the industry, including fuse8, as the emergence of a competitor for a share in the online market, especially within the UK, is considered to be a pleasant change. Many believe Google, who have previously held two thirds of the market share, will now have to up their game and become more competitive.
While many professionals within the industry believe that Google won’t budge in terms of their online dominance, this merger puts Microsoft in an extremely good position. Yahoo! predicts that, by combining with such a powerful online force, they will increase the company’s annual income by $500 million (£299 million).
With a combined UK market share of just over 4%, the Yahoo!-Bing search deal will have a minimal affect on your online marketing.
However, if the partnership succeeds in growing the internet search market share further, UK marketers will need to seriously consider Bing and adapt their SEM strategy to include the new partnership.
“This merger will now force the industry to recognise Bing and include the search engine within there SEO practices,” says Polly Pospelova, fuse8’s SEO Consultant. “The newly formed partnership between Yahoo! and Microsoft could also provide more innovative searches as well as increasing choice for the consumer in a market that is, at present, controlled by one organisation.”
Bing’s rich search results are very impressive, especially when it comes to synthesising information and summarising it. fuse8’s SEO team will definitely be adapting processes to include Bing.
It remains to be seen whether or not the merger will be a success, but when two online giants take part in such a fierce competition, only one can come out the true winner!