LBi London

Posted by evakeo July 19th, 2010

As reported around this time last year Yahoo and Microsoft have signed a $700 million deal which meant that Bing would provide Yahoo’s search results leaving our friends in Sunnyvale to run what will effectively be a content based web portal, one far more popular in the US than here or the rest of Europe. Clearly, this is all part of Microsoft’s offensive against Google, which has also included taking a stake in Facebook, thus leading a conglomerate of brands against Larry Page and Sergey Brin’s search giant. But now the competitive scramble for users in the search space seems to involve almost every trendy brand in digital.

However, regarding the specific Yahoo/Bing deal, things just started to get a little more real. Last week an update was sent to advertisers stating that Yahoo would being serving natural search results from Bing from “August or September onwards”. Moreover Yahoo will integrate its PPC ads to Microsoft’s AdCenter by the beginning of the ‘holiday season’ (that’s Christmas to us limeys) but may delay that until 2011 if it decides that would “improve the overall experience” for both advertisers and users. “If organic search results are an important source of referrals to your website, you’ll want to make sure that you’re prepared for this change,” so the email said. Well sure, 80% of internet journeys start with search and these two new found friends are important to the search market, though Google is still leading by far, more so in the UK than most places.

According to ComScore’s latest figures from last month, Google have 91.7% of the UK search market with Bing and Yahoo on 2.98% and 2.55% respectively, figures largely unchanged from the last quarter. In the US it’s a different ball game with Google on “just” 63.70%, Yahoo on 18.30% and Bing on 12.10%, with slight rises from the last two against Google over the last quarter.

So many hope that this deal will have a positive effect on search in terms of innovation. For a start, Google will have to try harder, especially in the States, something which will have a knock on affect to the rest of the world. The biggest reason for this is that the merger obviously means increased market share to around a third for Bing/Yahoo. Such an enlarged competitor means more advertisers who may have previously only used Google may experiment with AdCenter, meaning that Google will have to try harder to keep users using their brand, something they have managed quite well in the past from free applications such as Maps and Gmail, to paid for models like the mobile operating system Android and even a rumoured hardware rival to Apple’s iPad.

As SEO industry guru Danny Sullivan said last year, “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.”

In what form might this innovation come? Well, social could be the key to that. For over a year now it has been speculated that Google use more than PageRank to determine the rankings of web pages. Many search analysts believe that inbuilt into the algorithm are signals from offline media and social networks, even those, such as Twitter and Facebook, that have their links set to ‘nofollow’ (so no link equity is passed on). These links would not carry as much weight as a “regular link” but evidence has been recorded of increased natural search ranking even when no links have been involved. Most famous of these is the recent Magners example from eConsultancy.

Personally, I think it’s fair to say that nothing is certain at this stage, so little is with Google’s algorithm, but there is definitely more emphasis being put on social activity, mainly because since October last year Twitter’s main revenue stream has come from sharing data with Google and Bing, a process that began when Tweets started to show up in natural search results as the engines clambered over themselves to show more ‘real time’ information to the user.

Also, as blogged about by my colleague Johnny Gedye, location based social networking site Foursquare are in talks with Google and Microsoft for a similar deal to Twitter’s:

‘Speaking to the Telegraph, [Foursquare co-founder] Crowley said Foursquare was discussing partnerships with “everyone” – which would include search kings Google, Microsoft and Yahoo! – to “enrich” their search engines with trends generated by the location-based data.

“We can anonymise data and use it to show venues which are trending at that moment,” Crowley explained, voicing the example of Twitter, “Twitter helped the world and the search engines know what people are talking about,” he continued. “Foursquare would allow people to search for the types of place people are going to – and where is trending – not what.”’

And this isn’t the only area where location based networks are springing up. Last month Twitter itself launched Twitter Places whereby users are able to tag tweets to specific places (such as venues) and clicking on those location names will bring up recent tweets from those places. Whether this will become part of the data fed to Google and Microsoft remains to be seen but there is certainly a scramble to make location an integral part of the search experience. Facebook is also rumoured to be developing a similar offering, not to mention anything that may be being thrashed out with Gowalla.

No one knows who will come out on top of this but one thing is for sure, search is only going to become a richer channel over the next year and it looks likely that the brands that make best use of the social space will be the ones that benefit the most.

Tags: Bing, Facebook, foursquare, Google, SEO, Social Media, twitter, yahoo!

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