Sunday, August 2, 2009

Microsoft Deal with Yahoo! Looks To Next Generation

Microsoft (MSFT) has talked about using it Bing search engine to
search the internet "real time" to pick up Twitter messages and other
information and data that rockets across the web nano-second by
nano-second.

In theory , mappingthe web as it evolves may be nearly as valuable as
indexing old pages which is what search engines have done for years.

Wall St. has assumed that Yahoo! (YHOO) would stop devoting resource
to search technology now that it will use Bing for its search
functions. Yahoo! is making clear that is not true, even as the ink on
its deal with Microsoft is still in the process of drying.

According toReuters, Yahoo's Prabhakar Raghavan, head of Yahoo Labs,
said that the company could potentially "mine" messages from Twitter,
the popular microblogging service, to offer Web surfers search results
beyond those offered by Microsoft's Bing.

Yahoo! may have decided that it does not want to leave its entire fate
in the search business to its ten-year alliance with Redmond. The
portal company has to contend with the fact that market leader Google
(GOOG) will continue to improve its product. It may even be able to
increase its 65% market share in the US. Google still has the
opportunity to add features to its core search features and those
improvements could bring it even more customers.

Yahoo!'s concern now must be that even if it can bring new search
features to market, they may not be ones that the market cares about.

There is no clear indication that consumers or business care about
what goes on across the internet "real time". Twitter messages,
texting, figures that are transmitted from point-to-point without
analysis may be so much "space junk" circling the world of the
valuable data the Google delivers with its basic product. Real time
search may produce results so raw and disorganized that no one can use
them.

Yahoo! may have some success delivering the next big thing in search
engine results but it may not be anything people care about.

Douglas A. McIntyre


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