SiteLines - Ideas About Web Searching

Want a glimpse into the search future? Google Labs and Yahoo Next

Want to see what's new on the (commercial) search horizon? Try the not-quite-ready-for-prime-time search offerings of the major engines, like Google Labs and Yahoo Next.

One tip: If you're like me and you want to try to get a glimpse of trends, try to look for similarities between the offerings of these two hot competitors. Right now I'm seeing pointers to a differentiation of two types of Internet -- one for "serious" research-oriented questions (although I'm curious to see how either of these behemoths defines "research") and another for shopping.

We already see some of that differentiation with Google Scholar, Google Print, Yahoo Mindset and Yahoo Subscriptions. Each of these alleged "testbeds" offer searchers access to more highly differentiated content than would be available in straight-up Google or Yahoo.

Why separate research and shopping, and what will this do for engine revenues? These new spinoffs offer a great untapped market for paid consumer-level content, as well as context-sensitive ads. The big engines are clearly betting that serious searchers are ready to pay, if only to satisfy their need for quality information that they can't find in a sea of search engine spam.

By separating research (i.e. pay-per-view, with a few free tidbits thrown in, like content from .edu sites) from shopping (i.e. everything else), the search engines can return to more traditional relevancy algorithms. Remember relevancy conditions like link analysis, proximity of terms, frequency of term occurance, and currency of information? In an shopping-free engine, those conditions can be re-introduced, leaving the optimizers to focus their beat-the-engine techniques on the shopping side of search.

Be Careful What You Google For

If you haven't tried going beyond the first 10-30 results in a search engine search recently, you may be surprised. Here is one on the keywords "rita vine" sitelines. Now, go to a deeper result -- say, the 19th page of results from the Google search above. Many of the links on that page that match the keywords have NOTHING to do with either me or Sitelines. They are covert pages that are optimized to drive traffic to their owner's sites, which exist with only one purpose -- to drive searchers to them so that they can earn revenue from search engines' adwords programs.

Bill Bittner of BWH Consulting offers a great explanation of why "deeper" results in search engines are often so bad in his discussion page "Be Careful What You Google For." (free registration required) Although he focuses on Google, his analysis applies to practically any search engine.

From the article:

"The Google method for reimbursing Web sites and ranking them has led to a proliferation of sites designed merely to collect revenue from Google. These sites may contain some superficial articles on a subject, but their main purpose is to trick the Google algorithms so they gain a high ranking and earn income from users who use their links. Google is constantly trying to modify its algorithms to stay ahead of the imposters.

The net result of all this "portal spam" is that searches done through Google become less useful. Instead of finding meaningful results, the user is confronted with a bunch of meaningless sites, while the really useful sites who are not "playing the game" end up relegated to the bottom of the results, if they show up at all. People end up abandoning the Internet for their locally focused and trusted source, the Yellow Pages."

The Looksmart/UC Berkeley Partnership

Spotted in John Battelle's weblog:

In its continuing effort to gain market share and "convert" users to its search product, Looksmart has done an affinity deal with UC Berkeley's Cal Athletics.

The deal applies the same principles that business organizations such as credit card companies use, which directly gives back $$ to the specific group (in this case the university's athletics programs). Looksmart will supply paid listings and results for visitors to calbears.com and calbearssearch.com, as well as a toolbar applications.

The idea is that if you use the Looksmart search tool, a portion of the revenue that Looksmart earns by delivering paid placement and ads will be returned to the institution. Berkeley gains revenue; Looksmart gains eyeballs over time.

Will Google and Yahoo users switch to the Looksmart brand in order to support their university? Should a prestigious academic institution be promoting lower-quality search tools which display paid results, over other higher quality web search resources? Should they be promoting the use of any commercial web search tool which derives its revenue for paid listings? And will Berkeley users know the difference, or care?

Thoughts on Clustering

I took a moment to look at Vivisimo's new clustered meta-offering called Clusty.com (which I'd like better if the content under the hood was better selected) which has catapulted Vivisimo into the public limelight this week.

Clustering is a very interesting way of algorithmically differentiating the content of large search results, but it really works best in differentiating aspects of similar topics (diagnosis of lung cancer vs. treatment of lung cancer) or different meanings of similar terms (e.g. chocolate mousse the dessert vs. chocolate mousse the oil spill). For example, clustering works well in Clustermed, which clusters Medline results, making it easier for researchers to zero in on the aspect of a topic without having to conduct a more complex search straight away. And Vivisimo's clustering works well with my search on chocolate mousse which has variable meanings. But when clustering is applied to more common topics (like mathematics education) in tools like Clusty.com, which draws from a multiplicity of large, generic search tools, the results aren't nearly as helpful. This is likely because the source content that is searched and sorted is so undifferentiated that the benefits of algorithmic sorting can't be fully realized.

More about my evaluation of Clusty.com in an upcoming SiteLines posting.

Governments are buying keyword ads in search engines

The BBC reports that the UK government is now paying for keyword ads in search engines after experiencing disappointing results following the launch of the latest UK government portal, Directgov.

This isn't new. Over a year ago, I noticed that the Canadian federal government and the Ontario provincial government were buying Google ads on selected keywords, clearly in the hope of driving traffic to their underused, fairly new, portal sites.

New sites don't often get a fair shake in search engines. Linkage requirements that search engines use to generate rankings favor popular, older, and better linked sites. New sites, even high quality ones, must often work harder just to get noticed, and search engine keyword placement is one way to drive awareness -- both to consumers of information, and also to those all-important web page creators who will (one hopes) link to these new sites and eventually improve their page rank.

An Analyst Takes A Peek Inside Microsoft's New Search Tool

In the August 2 issue of the Silk Road Weekly, Internet investment analyst and search-engine watcher Safa Rashtchy attended the Microsoft analyst day last week and has provided some of the most extensive analysis of Microsoft's beta entry into the search engine war. Some highlights from Rashtchy's comments:

"It was clear, to no surprise, that search is a major focus of MSN and MSFT, and that company officials were pleased with the search effort so far. The demos shown included interesting and unique features that involved combined desktop (PC) and web search experience. The performance of the demo was exceptionally fast. MSN also showed pure search results from its own search engine which is now almost functional but not yet deployed. MSN, in our opinion, is currently completing the first phase of building a good algorithmic search engine: build it to scale and create a large database (index). While this effort is quite complicated and involves a massive technology effort, it pales in comparison to what the second stage is: build a robust relevancy engine on top of the index. ...

"...Eventually (2006 and beyond) MSN will develop its own advertising network, replacing Overture/Yahoo. The search market, thus, has three major players but it will take MSN still a significant time before it can change the dynamic of the market."

All those search engine shortcuts - like, who cares?

Wow, even more search shortcuts coming out on Yahoo and Google these days. I wonder how many information searchers ever use these command-line tools for calculations, FEDEX/UPS tracking, phone number lookup, definitions and more. Not many, I think.

So why do the search engines keep bombarding us with ever-more command-line shortcuts? Well, they want us to think that the world is a one-box "command central" for finding the world's information, which of course it isn't. However, from a business standpoint, those command-line search shortcuts enable all the search properties to offer very targeted ad placements to organizations that want to zero in on a particular clientele. See, for example, Google's pitch to potential advertisers on its Adwords program, which directly links some of those command-line searches to targeted local ad placements.

It's several months old now, but Michael Singer's article "New Google Shortcuts Tie Into Paid Listings" from January's Internetnews.com describes how the shortcuts clearly tie into targeted paid listings. Caveat searcher.

Analyst Thoughts on Yahoo in the wake of the Google filing

Safa Rashtchy, Internet analyst at Piper Jaffray, thinks that Yahoo will be a solid competitor with Google as a revenue generator. In this week's issue of the Silk Road Weekly, he summarizes his key questions for the coming months:

1. competition with Google
2. capturing local search (this means capturing locally-targeted paid ads, like pizza in toronto
3. international expansion
4. growth strategy in branded advertising
5. Yahoo's recent ad campaign

He concludes, "We believe Yahoo is likely to present a compelling case in its competition with Google, leveraging its wider global reach and diversity of services. As such, we expect the stock to react well ..."

It's always important to remember that although a stock may be poised to "do well," searchers shouldn't necessarily assume that the stock will necessarily improve as a search tool.

Given all the buzz about the forthcoming Google IPO, it's ever more important to separate the buzz about a search engine property as an investment from its actual value as a useful search tool. One has rather little to do with the other.

Everything's Coming Up Yahoo!

Over the last couple of weeks, another significant result of consolidation was finalized as Alltheweb.com, Altavista.com and Lycos.com changed their default search engine to Yahoo's.

I conducted a couple of brief test searches to see how closely the results matched. The results are not precisely comparable because preferences within each search brand vary slightly and don't enable identical search conditions. Nevertheless, on examination of the first 20 search results in each tool (and ignoring the ads/sponsorship links), search results were similar though not precisely the same. (I am still wondering about why Yahoo's numbers were so much higher than the other brands, so if someone has an answer, please send me an email.) Of all the examples, only Lycos's results contain items not seen in the other search tools, and this might be explained by the presence of keyword-matched Looksmart results, which appear in Lycos but not in Altavista, Alltheweb, or Yahoo.

Regardless of the relatively minor differences in displayed results, there is no question that the index serving up the results is now clearly marked on all the properties as Yahoo's. As a result, there currently appears to be no compelling reason to regard any of these alternatively-branded engines as anything else but Yahoo clones, renamed.

You can see my test searches below: (all have content filter options turned OFF; language set to no preference, whenever possible)

mandatory retirement on Yahoo!
mandatory retirement on Alltheweb.com
mandatory retirement on Altavista.com
mandatory retirement on Lycos.com

Yahoo, Ask Jeeves and Infospace Lead Internet Property Consolidations

There has been a flurry of purchases in the last month by Yahoo!, Ask Jeeves and Infospace. Yahoo just bought Europe's largest shopping comparison engine, Kelkoo, which will enable it to effectively capture the major European web shopping market; Infospace bought Switchboard, a leading Internet-based yellow pages service; Ask Jeeves purchased Interactive Search Holdings, a privately held company which included a variety of search properties including My Way, My Search, My Web Search, iWon, and Excite.

In this week's Silk Road Weekly, Safa Rashtchy, Internet analyst for investment firm Piper Jaffrey, offers some thoughts on summarizes why he believes that these new consolidations will continue in earnest through 2004 and 2005:

1. The advertising market is strong, suggesting that these rapidly expanding companies, which earn their revenue from advertising, will likely be profitable.
2. These surviving companies (Yahoo, AskJeeves, Infospace) are clearly the winners and are gaining strength. So this is a fertile landscape for acquisitions as a key strategy for growth.
3. Web search is now directly tied with market share and traffic, so a higher percentage of reach almost guarantees a higher percentage of revenues. In other words, if you buy the properties, and you get the all-important traffic, which means a lot.
4. The "Google Factor" -- Google's search dominance has created huge competitive pressure for nearly everyone in the industry, fueling an acquisition trend to strengthen position. Google "even without public stock, has probably more cash than many smaller comapnies and a currency that may be viewed as equally valuable as a public one, [which] creates more pressure on the potential consolidators."

As consolidation of search properties increases, the utility of searching multiple popular commercial search tools will continue to yield fewer distinctive results. We saw evidence of this last week when Alltheweb, a popular search engine previously recommended by several web experts (including me), abandoned both its independently spidered index and many of its advanced search features, and now essentially delivers Yahoo search results under the Alltheweb.com brand. (See Greg Notess' post in Search Engine Showdow for more on the Alltheweb shift.)

My Search Index is Bigger than Your Search Index

It appears that the war for search engine content supremacy is on. Although many observers originally thought that Yahoo! would choose not to compete head-on with Google's "serious search" focus, and might focus instead as a shopping engine, it appears that Yahoo! intends to promote the value of its search index.

This week, Yahoo! announced that it is seeking to enhance its search index through a new Content Acquisition Program (CAP). Through this program, it will enter into mainly non-exclusive arrangements with content providers such as the Library of Congress and National Public Radio. CAP will also extend to other, commercial providers of information, although this was not featured in the announcement.

This action sounds similar to Google's recent announcement that it would acquire content from OCLC for addition to its index.

These efforts will enlarge the search indexes of both properties, although it is difficult at this early stage to assess the impact of these expanded indexes on search quality or relevance. Searchers need to remember that the sheer size of a search engine index isn't really much of a consideration in determining relevancy: it's the sorting algorithm that has the biggest impact on what the searcher ultimately sees on the results page.

While many searchers will applaud an even larger search index, it is also important to remember the commercial potential of a persistently growing web index consisting of billions -- possibly tens of billions -- of web pages. Because relevant information will become more difficult to find as sorting algorithms begin to fail to achieve relevancy goals, there will be even greater pressure on content providers to advertise in order to get favored placement in search results. In recent weeks, we have seen at least two incidences of Canadian government content providers (HealthyOntario.com and Culture.ca) place web ads in Google to ensure that their URL comes upon the first page following selected keyword searches.

Article: The Business of Search Engines

My article "The business of search engines: how advertising, partnerships, and the race for market dominance affects search tools and search results" has just been published in the February 2004 issue of SLA Information Outlook. Members can read the article with username/password login at http://www.sla.org/content/memberonly/infoonline/2004/February2004/SearchEngines.cfm -- the journal is also available through Proquest (but as of today was not yet available at the Proquest site).

New Search Engines are Ready To Jump When Google Changes Focus

(CORRECTED January 27 2004 -- Thanks to Michael Fagan for providing me with a correction on Google's relationship to Orkut.)

I've seen more than the usual number of announcements of new search engines during the last month. Names like Dipsie, Mooter Eurekster, Meceoo (meta-search), Metrobot (local search) -- and the list goes on. These new tools (most are in "beta") join a half-dozen existing search engine properties, including Teoma, Wisenut, and Gigablast -- all seeking to grab your eyeballs and become the next search engine of choice when you dump (!) Google.

These new entries point to a feeling that 2004 will bring some leveling to the search engine playing field after Google goes public. (For an idea of how the search engine optimization industry views the future, see 2004 Search Engine Predictions from SEO Professionals), Clearly the owners of these new search properties hope that the same magic combination -- of need, timing and a great name -- that turned Google into the world's best known brand will also sprinkle a little fairy dust their way. But will there be room for a new search engine?

The signs are indicative of some reduction -- make that dilution -- in Google's impact on search relevancy in 2004. Google is already launching services that look designed to boost revenue generation and expand the brand as a true portal site. Rumors of a Google email service and Google's release of the social networking/friend-making/dating site Orkut look much like Yahoo's moves into similar "beyond-search" areas. As revenue generation in many guises becomes more important, search algorithms could be diluted, not only by paid placement in Google's search results but also by a lowered corporate focus on search relevancy generally.

Google's gift to searchers has always been its unyielding corporate focus on search relevance, but if the company moves (as Yahoo! has) into non-search revenue streams, Google could become a less desirable tool of choice for the serious searcher.

Did the Google/Microsoft Talks Actually Happen?

in his column today, Dan Gillmor of Mercury News wonders who floated the news of a Microsoft/Google negotiation that made news everywhere (including here). Gilmor reports that Bill Gates denied any discussions of mergers or acquisitions, and suspects that the culprit may be venture capitalists and other insiders engaging in pre-IPO puffery to inflate initial values.

Visualize Search Engine Relationships

In preparation for an advanced web search session, I came across a fabulous FLASH chart of the major search engine relationships, courtesy of Bruce Clay LLC, an Internet business and marketing consultant. This is a great tool to help learners visualize the relationships between search engines and their content suppliers. Let your mouse hover over a search tool, and watch as the chart highlights the relationships. At the present time, only US search properties are listed, but charts from other regions are promised.

Google's Deskbar and Microsoft's Plans for Browser-free searching

Google Labs recently launched the Google Deskbar a downloadable Windows application that lets you search Google without opening the browser, from any application. If you're thinking about downloading it, you might want to read some of the posts in the Google Deskbar Forum before committing. (Gary Price has also reported that the Deskbar crashed his computer a couple of times, reminding us that this is beta software.)

Why a deskbar when browser-based Google is just a double click away? Charles Arthur, in his November 12 column in the Independent, suggests that this may be a response to Microsoft's plans to embed web search capabilities into it's next operating system, Longhorn -- which would enable Longhorn users to conduct a web search within the operating system, without having to open a browser.

If Microsoft were to enable Google-style functionality inside it's operating system, the convenience factor alone could make the MS search product the default engine of choice, regardless of the likely presence of paid inclusion in the results.

Google's Deskbar and Microsoft's Plans for Browser-free searching

Google Labs recently launched the Google Deskbar a downloadable Windows application that lets you search Google without opening the browser, from any application. If you're thinking about downloading it, you might want to read some of the posts in the Google Deskbar Forum before committing. (Gary Price has also reported that the Deskbar crashed his computer a couple of times, reminding us that this is beta software.)

Why a deskbar when browser-based Google is just a double click away? Charles Arthur, in his November 12 column in the Independent, suggests that this may be a response to Microsoft's plans to embed web search capabilities into it's next operating system, Longhorn -- which would enable Longhorn users to conduct a web search within the operating system, without having to open a browser.

If Microsoft were to enable Google-style functionality inside it's operating system, the convenience factor alone could make the MS search product the default engine of choice, regardless of the likely presence of paid inclusion in the results.

Whole Lotta Keyword Buying Goin' On

The Interactive Advertising Bureau produces and makes available regular reports on the state of Internet advertising revenue, and tracks growth (or shrinkage) and overall market trends. The release of Q2 results for 2003 confirms what search property analysts have predicted for more than a year -- that keyword search ad purchases (aka paid placement) would continue to rise very significantly.

Internet ad revenue in the first 6 months of 2003 totalled $3.3 billion, a 10.5% increase from the same period a year earlier. While that is a significant gain, it's not startling -- until you discover that the greatest portion of that rise was due to an increase of keyword buying in search tools. Keyword-buying represented 31% of the total of all Internet ad revenues, compared with 9% during the same period in 2002.

In other words, there's lots more buying of keywords in commercial search tools, with paid placement of results. And, as you might suspect, banner advertising (the stuff that you have trained yourself to deliberately ignore) is declining.

The full report (17 pages, with lots of charts: an easy read) is available at http://iab.net/resources/ad_revenue.asp. Registration (free) is required.

Pay-Per-View Pressure Points

Over the last three months, there have been some interesting news stories focusing on delivering fee-based article-level content to end users directly.

Pressure Point 1: Microsoft embeds pay-per-article content into next-generation MS Office

Microsoft will bundle pay-per-view access to selected Gale ,Lexis-Nexis and other partner content into its next release of Microsoft Office, enabling users who require information to do a quick search, identify articles, and purchase them instantly for a few dollars each. Vendors are betting that most people have no sense of where to look to find article-level information on the web and will pay for the convenience factor, making the a compelling business case for this type of content delivery. (To learn more about the bundling and why it's so exciting to vendors, read Barbara Quint's excellent article in the March 17 issue of Information Today)

Pressure Point 2: Industry analysts strongly prefer pay-per-view over subscription models

Largely overlooked last week was a report that the stock price of Elsevier, one of the world's largest publishers, had dropped sharply following BNP Paribas' release of a research report indicating dissatisfaction with Elsevier's persistent use of blanket subscriptions rather than more profitable pay-per-article model.

These bits of news point to an interesting trend toward the legitimizing, finally, of pay-per-view of electronic content. Long hoped for by publishers but unacceptable to users who expected free information or who were unwilling to pay, there seems to be increasing acceptance of pay-per-view as a legitimate and profitable business model. Companies like Gale, Microsoft, and Lexis-Nexis (which is owned by Elsevier) are betting that if they present inexpensive pay-for content at the moment of need, harried searchers eager for quality information will buy.

It's a substantial stretch to assume that electronic publishers will suddenly abandon blanket subscriptions -- the core of academic library purchases -- in the near future. However, if the pay-per-use model proves as profitable as analysts suggest it could become, subscription customers can expect to see some readjustment of the subscription model to make pay-per-view a more attractive option than it seems now.

What Stock Analysts Say about the Search Business

Understanding the business of web search from the investor's perspective can help searchers better understand their search results. The true business goal of all search engines is to deliver products to eyeballs at the moment of need, through a variety of mechanisms including results placement and keyword buying. I view search engines and commercial consumer search tools as being not in the search business, but in the advertising business, and so do the industry analysts that follow search companies.

Analysts agree that the search business is very hot. In the June 12 2003 report Search Leads Online Advertising Rebound (available through Investext) Richard Fetyko of Kaufman Brothers notes that "search-driven advertising (paid placement and paid inclusion) was just about the only growth area of online advertising for the last two years.... Search-driven advertising now represents over 20% of the total [online advertising expenditures], up from only 4% in 2001." And given that online advertising still represents a very small portion of total advertising sales, analysts agree that there is great potential for substantial growth in search engine advertising in the next couple of years. Safa Rashtachy, an analyst with US Bancorp Piper Jaffrey and author of the weekly Silk Road Weekly, predicted in March 2003's Golden Search (reported in SiteLines on April 24) that "search and advertising companies will show the fastest growth of all sectors [of e-business] over the next 18-24 months, ahead of e-commerce, services and other segments."

The numbers prove the story. Stocks of search advertising companies have made astonishing gains in the last year. AskJeeves moved from a low of under $1 to today's opening price of $15.37, and the rise has been steady, not choppy. Yahoo's value rose from under $9 to today's opening price of $31.28.

Just as advertising influences the editorial content of print magazines, so will advertising ultimately influence the content of search results in search engines. These strong trends suggest that more advertisers will buy web-based ads and spend more money doing it. They will buy keywords for more products and services from search companies like Yahoo!, Google, AskJeeves, and FindWhat (which delivers paid results to second tier players like Dogpile and Metacrawler). Search companies will develop and refine their methods of depositing advertising in front of your eyeballs when you conduct a search.

Without a solid understanding of how to go beyond search engines to find quality resources, the information consumer's awareness of particular brands will narrow and they will remember the brands that they see advertised most often on search engine sites, even if they never click on the ad. Without greater awareness of how search engines deliver ads to users, the presence of search engine advertising will ultimately influence the information seeker's choice of search tool as well as their information buying decisions over time.

Key findings from the Consumer WebWatch Study on recognition of paid results in search engines

Consumer WebWatch (http://www.consumerwebwatch.org) the web watchdog arm of Consumer Reports, will release an important study in late June 2003 on the degree to which consumer web users can recognize the presence of paid listings on a search site. We'll have to wait until June for the full report, but preliminary results of the study were reported at a recent industry panel held on April 24 and titled Building Trust on the Web: Consumer WebWatch's First National Summit on Web Credibility

The April 24 panel paired pay-for-placement leaders Matt Cutts of Google and Doug Leeds of Overture against the research. The study's key findings tell the story beautifully. "All study participants expressed surprise after learning about pay-for-placement (some had emotional reactions), and their behavior changed accordingly. Most consumers said paid search disclosure information on search and navigation sites was too difficult to recognize or find on many sites, and that the information available was clearly written for the advertiser, not the consumer."

Keyword-selling search tools (like Google and Overture) have always asserted that consumers know the difference between pay-for-placement content and "true" search results. Our own experience at Workingfaster.com in training both typical and more advanced searchers matches the findings of the report -- that almost no searchers are aware of pay-for-placement content until it is pointed out to them, and thereafter their behavior and attitudes change.

The Trouble with Meta-Search

Consumer Web Watch columnist Angela Gunn's article, "In Search of Disclosure" explains how paid-for sites get mixed up with "real" search results in meta-search tools like Dogpile, Metacrawler, Mamma and many more. The implications may be inconsequential for many searches, but for information in which accuracy and specificity is essential -- health information, for instance -- a meta-search tool would be a poor choice.

Gunn also reminds readers to pay close attention to links on meta-search sites titled "About Results," "About Search," or something similar. These links will usually indicate which source tools provided the link -- and a few clicks on those links should provide clues on which search tools deliver paid listings.

More from "Golden Search"

The nice people at U.S. Bancorp Piper Jaffray sent me the full 90-page report Golden Search today. This is required reading for anyone at the advanced search level or who teaches search engines to end users.

Some fascinating tidbits from my first reading:

• Together Google, Yahoo!, MSN, and AOL have greater than 80% market share of search, with Google running at almost half of that, at 34%.
• Total searches done: almost 550 million per day worldwide; 245 million per day in the United States
• What do people search on: 65% on information and reference; 15% on commerce-related searches; 20% on entertainment-related searches - and of that total, the report estimates that 35% of all searches could be commercial in nature

• Great improvements in "search monetization" (which translates as making money from search technology improvements) will happen in the coming years to deliver eyeballs to advertisers at the moment they are actively looking to purchase something.
• Expect Yahoo! to switch its search engine partner from Google to Inktomi, imminently, as Yahoo's purchase of Inktomi is finalized
• Partnerships are everywhere, usually in sets of three (algorithmic search + paid inclusion + paid listings) and the number of players is relatively small (which explains why you see the same search results coming up in different places) -- examples include Lycos+Overture+AlltheWeb; AskJeeves+Teoma+Google; MSN+Looksmart+Overture

Rashtchy's full report The Golden Search, is available free with registration through Multex Investor (U.S. addresses are required) or and also to Investext Plus subscribers.

5 Key Trends to Shape the Future of the Search Industry

As an amateur (and largely unsuccessful) stock picker, I'm fascinated by how differently information seekers see web search as compared to search business professionals. Information seekers think of web search sites as helpful tools, but web search specialists know that most commercial web search tools are in the business of growing a customer base. The business of search engines has little to do with searching and everything to do with revenue growth.

Analyst Safa Rashtchy tracks search companies for investor clients of U.S. Bancorp Piper Jaffray. In a March 20 2003 press release from U.S. Bancorp Piper Jaffray, he identified five key trends that he believes will shape the future of the search industry.

Search Capitalism - Overturism, or the idea of paid search as a market-driven customer acquisition vehicle
Googlism - increased importance of relevance and a race to provide the best search experience,
Globalism - the increased importance of international markets and its impact on the partnerships among search companies,
Elitism - concentration of search among key destinations and the increasing importance of branded destinations, and
Realism- the next phase in search: in-context search.

Rashtchy asserts that the industry represents a major growth market and will grow in excess of 35% per year. In addition, he believes that the key driver of growth is "the increased popularity of search as the most efficient way to find products and information, and simultaneously the rise of search as the best way for advertisers to find and acquire customers." Rashtchy sees Overture and MSN as key companies to watch in this area.

Rashtchy's full report The Golden Search, is available free with registration through Multex Investor (U.S. addresses are required) or and also to Investext Plussubscribers.

Directories OUT, $$ for Clicks IN?

CNET's March 24 2003 article "The changing face of search engines" notes that webmasters are bypassing commercial directories for their listings in favor of pay-for-placement direct advertising. What does this mean for searchers?

The power shift has forced well-branded directories like Yahoo to reinvent its search business to look more like those offered by Google and Overture Services. Meanwhile, altruistic ventures like the Open Directory Project, Librarians Index and others seem to be the only options left that are really grounded in the original concept of the Net as an information source.

Overture Buys Search Engines

Last week two major search engines, AltaVista and AlltheWeb were sold to Overture, a web advertising firm that sells search keywords to advertisers. These events follow AskJeeves' purchase of the search engine Teoma earlier this year and Yahoo's purchase of the Inktomi search engine this summer.

As a result of these purchases, Google remains the only independently produced search engine not owned by an advertising or marketing e-company. However, it's worth noting that Google itself is one of the world's largest keyword sellers, rivaling Overture in advertising revenue but remaining morally upright by clearly labelling sponsored search results that appear on its pages. It's hard to predict how long Google will resist an appropriate, monied suitor willing to pay for Google's value as the most recognized brand in the world, and its favored position with advertisers.

Whenever a Google takeover happens, expect Google to change. No, don't stop using Google. Not yet. But it would be useful to consider a runner-up search engine in case Google starts behaving badly (Greg Notess' Search Engine Showdown has a good list of search engines charted by size) plus a selection of best-of-breed subject directories (see a few of our favorites, extracted from the Search Portfolio, at our Search Portfolio Litesite that will unearth some of those hidden gems.