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May 30, 2004

Google and search engine strategies

Search engine companies seem to be embroiled in a fight, trying to outdo each other, while at the same time trying to come up with a better mouse trap.

Microsoft said it is planning to extend its new Web search technology to include search for information contained on personal computers, e-mails and databases.

Google is reportedly working on a similar feature to allow searches on local hard drives on PCs, while it is already locked in competition with Yahoo in the local search segment.

Yahoo will use its community of users to deliver more customized search results, something that rivals such as Google and Microsoft will have a harder time doing, Chief Executive Terry Semel said on Thursday.

The comments come as Microsoft, Yahoo and Google position themselves for major upgrades over the next year as they try to attract more users and advertising revenue by enhancing their search services.

Terry Semel, a former Hollywood studio head credited with leading Yahoo back to a healthy Web property, reiterated that the online advertising market was poised for rapid growth as advertisers begin to follow media audiences to the Internet from television and other traditional sources.

"When ... you talk about local search, you're opening up a whole other arena of advertising," Semel, monitored by Webcast, told investors at the Goldman Sachs Investment Conference in Las Vegas.

Customized search is considered the next step in improving the relevancy and accuracy of search results. If search engines knew more about the interests and habits of Web searchers, experts say that search engines would be able to deliver much more precise results.

Semel also said that his goal was to enhance Yahoo's features, which include Web search, personals, shopping, and Web-based e-mail, so that visitors would spend more time at Yahoo's Web properties, increasing their exposure to advertising and the chance that they would spend more money.

Yusuf Mehdi, the executive at Microsoft's Internet unit MSN leading the charge on search, said that Microsoft had already started to discuss plans to integrate its new search technology with Longhorn, the code name for the next version of Windows due out in 2006.

"We will do an MSN search starting shortly with a beta and well before Longhorn ships, everything across local PC search, e-mail search, Web search, deep database search," Mehdi said at the same conference on Wednesday, referring to the test version of Microsoft's search technology due out later this year.

Mehdi said that search technology for the PC would appear well before the launch of the next version of Windows, although the details had yet to be worked out.

Ironically, Microsoft offers the ability to search for files within Windows, but Mehdi admitted that it could be done much faster and efficiently.

"Why does it take so much time to search the PC when you can index the whole Web and find it in milliseconds," Mehdi said.

Google is also aiming at offering its services on the desktop with a new search tool, code-named Puffin, to exploit the lack of fast search capabilities in Windows.

Source: Yahoo Finance

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