Effective Link Building Service: Just Behave: Bing + Yahoo: What Does It Mean For Users?

**Bing + Yahoo: What Does It Mean For Users?**

**by Gord Hotchkiss**

The deal is done. Microsoft has swallowed Yahoo search whole and we
can all be put out of our long, lingering misery. Yahoo has given up
on search and thrown in the towel. But, outside this industry and our
incestuous little gossip circle, what does it really mean for average
folks? Does it make a difference… really? When all is said and done,
will the news amount to a hill of beans?

Well, in the long run, it's probably a good thing for most of the
players involved, including users. My original concern when rumors of
Microhoo started to fly was the distraction that the integration of
two very different and somewhat challenging cultures would become. I
was afraid that the search user experience would get lost in the
process. But the revenue share split does away with that concern,
which is good for users. Yahoo can continue to be Yahoo, minus the
"distraction" of search. Microsoft can get serious about search
with a more viable economic engine to justify their investment.
Basically, the deal gives Microsoft a whole lot more eyeballs for
Bing, and that's going to be beneficial for everyone.

But there are some other reasons why the search user could benefit
from this deal:

A release of talent

There's a whole bunch of PO'd, disenfranchised search engineers that
have just had a frightening but potentially liberating view of the
future: freed from the shackles of the rapidly sinking S.S. Yahoo,
they might actually have a chance to do something meaningful in
search.

I've had the opportunity to talk to various members of the Yahoo!
search team over the last several years, under Semel, Yang and Bartz.
The underlying current was always one of thinly veiled frustration.
They deserved better. They were smart and, once upon a time,
passionate about search. But for the past several years they were left
hanging out there, blowing in the breeze. They yearned to do something
meaningful. Now, with the ladder kicked out from underneath them, they
have no alternative. Whoever hasn't already jumped ship will be forced
to find new, and hopefully, more rewarding homes.

Pushing the wolves back from the door

At the risk of sounding like a broken record, or, less
anachronistically, a skipping MP3 file, search needs a major shot of
innovation. The dysfunctional competitive environment that we've had
for the last few years put all the major players in a position where
innovation wasn't encourage. Specifically:

Google. As the market leader with a major marketshare, almost
completely dependent on the search advertising revenue stream, it's
hard to rock that boat too vigorously. Every minor change in the
search UI could have a potentially negative impact on ad
clickthroughs. The dynamics of the SERP are subtle and small changes
can have big impacts on behavior. Given the obsessive focus on
quarterly revenue numbers by Wall Street analysts, and the macro
economic impact of the recession, this was not the time to boldly
screw around with your golden egg-laying goose. Google always speaks a
good game when it comes to hyping their efforts to innovate in search,
but come on, how different is the Google SERP now from what it was 4
years ago? How innovative have they been with AdWords?

Microsoft. Microsoft was the one who was really in a position to
innovate, but despite repeated commitments to search from everyone
from Gates on down for the last several years, the company's track
record has been less than stellar, to be exceedingly kind. Bing is the
first sign that they're motivated to get it right, and that's really
more of a catch up move than anything. But at least they're in the
game now. I think the biggest problem was getting alignment in the
gargantuan, lumbering Microsoft corporate structure. There was a lot
of left hand/right hand lack of communication from Spanky and the gang
in Redmond. It's hard to innovate when you don't even know who's
working on what.

With Bing, Microsoft showed they can execute. Now, let's see if they
can innovate.

Yahoo. You don't innovate on the Titanic: you just try to survive.
Nuff said.

What the Microsoft-Yahoo deal does is allow Microsoft's search
champions to better sell the need to innovate within the company. They
have a bigger market share, can forecast significant revenue potential
and make the case for investing in rapidly upping the search
experience bar. Microsoft can afford the fluctuations that are
inevitable in ad revenue as they experiment with the UI, because
search is a pretty small drop in the revenue bucket. And it's
certainly not that they don't have the resources—all they need is
the corporate prioritization and alignment. This deal may just do that
for them.

A bigger ad inventory

Microsoft CEO Steve Ballmer sent the signal of the true value of a
Yahoo partnership when he said last December:

"We're fully prepared to compete without any partnership with
Yahoo. We don't need to act. Would it be advantageous for both of us
to make a deal? Look, the fundamental basis for doing the search deal
with Yahoo has to do with critical mass in the advertising
marketplace. It doesn't have to do with technology, or any of these
other things, it really is a market phenomenon. Together we would have
more advertisers… which means we'd have more relevant ads on our
page. We'd have higher monetization levels possible in front of us
because there would be more people bidding on more key words. Most
importantly, Google would have perhaps a real credible competitor
sooner."

Success in search is all about relevancy. And if ads are going to be
part of the results set, those ads better be as relevant as possible.
The bigger the ad inventory, the more relevant they will be. It's a
pretty simple equation.

And ad relevance is massively important to the user experience. At
Enquiro we've done several studies that either directly or indirectly
examined the importance of ad relevance to the overall search
experience. The results are abundantly clear: the better the ads, the
happier the user. The deal gives Microsoft a massive increase in
advertiser inventory, and that's perhaps the most important asset in
the deal. It doesn't matter that Yahoo gets 88% of the revenue. That's
short term thinking. This is about running all those ads through the
Microsoft platform, giving them the ability to control quality,
targeting and relevance. The goal is gaining market share, and you
need the highest quality ads possible to do that.

A stronger commitment from advertisers

No longer is an ad buy on Microsoft tossing them a bone out of guilt
or a gesture of protest against a Google monopoly. With a combined
market share pushing 30 points, that's a serious slice of available
eyeballs. Microsoft just became a mandatory buy. That allows them to
build stronger relationships with advertisers, getting a more serious
commitment in return. If Microsoft can pull the pieces of AdCenter
together like they did with Bing, they'll have a pretty powerful ad
management platform. And Microsoft doesn't suffer from the same
passive-aggressive relationship with marketers that still lingers in
the halls of the Googleplex. Advertisers look at Google with a mixture
of resignation, fear and resentment. More than a few will willing fall
into Microsoft's embrace, now that there's a justifiable reason to do
so.

How does this help the user? Happy advertisers mean happy corporate
execs up in Redmond, which means more of an appetite for innovation.
Expect Microsoft to be more innovative in offering sponsored search
formats. And happy advertisers also means more relevant ads (see my
previous point).

More serious competition for Google

This deal sends a signal Google can't ignore. They're still in the
search driver's seat, but at least now they can see someone in their
rearview mirror. If Microsoft can adopt a passion for innovation and
push the envelope, Google will have to respond in kind. The search
experience will evolve more rapidly, hopefully kicked out of the
revenue obsessed stasis that it's currently in. Stagnation benefits no
one except the analysts and bean counters who insist that quarter over
quarter performance is the only metric that matters. We're way too
early in the game to be that cautious and boring.

Will the Microsoft-Yahoo deal break the Google habit? No. In fact,
Google will probably net a couple more percentage points out of this
in the short term. But this lays the foundation of a more competitive
market place, which can't help but benefit users.

The deal puts Microsoft in the game. Now, let's see what they do with
the opportunity.

Opinions expressed in the article are those of the author, and not
necessarily Search Engine Land.

Gord Hotchkiss <http://searchengineland.com/author/gord-hotchkiss/>
is CEO of Enquiro <http://www.enquiro.com/>
, a search marketing firm that produces search engine user eye
tracking studies <http://www.enquiro.com/eyetrackingreport.asp>
and other research.

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Friday, July 31, 2009

Just Behave: Bing + Yahoo: What Does It Mean For Users?

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