Maybe buying Yahoo is the right way to go

Nov 20, 2007 09:29 GMT  ·  By

At the end of September 2007, Microsoft pumped Live Search full of steroids gunning after Google and Yahoo, but the move was to no avail. The evolution from version 1.0 to 2.0 for the Microsoft search engine under the Windows Live brand umbrella was a strategy aimed at boosting the company's share on the search engine market. The combined results from MSN and Live Search have as far positioned Microsoft as the traditional bronze winner in a race with just three search competitors.

"Google accounted for 64.49 percent of all U.S.searches in the four weeks ending October 27, 2007. Yahoo! Search, MSN Search and Ask.com each received 21.65, 7.42 and 4.76 percent respectively. The remaining 49 search engines in the Hitwise Search Engine Analysis Tool accounted for 1.68 percent of U.S. searches", Hitwise revealed.

Microsoft introduced in September a complex overhauling to Live Search. Tagging the version label to 2.0 was a move synonymous with the introduction of upgrades both on the surface and under the hood. The redesign to the graphical user interface was not the sole change brought to Live Search. Microsoft also quadrupled the size of the Live Search index, which means that the search engine is now able to point user to in excess of 20 billion pages.

But the upgrade also catalyzed comprehensive changes in terms of relevance, additional features and a new line-up of components, on top of the search engine's core. But one month later, the latest statistics indicate that Live Search 2.0 just found a cozy place in Microsoft's downward search spiral. The Redmond company in fact lost market share dropping from 7.83% in September to 7.42% in October.

Microsoft President of Platforms & Services Kevin Johnson revealed recently that the company aims at becoming the runner up on the online advertising market in the upcoming three to five years, largely closing the immense gap that separates it from Google. But such a move is roughly equivalent with the No. 2 position on the search engine market. And in this sense, Yahoo is Microsoft's way to Google. Now, rumors pointing to an imminent acquisition of Yahoo by Microsoft are no novelty item, but could they actually hold a grain of truth, in light of the Redmond company's new found commitment?