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Ask Jeeves says acquisition of Tukaroo is good strategy

Ask Jeeves's acquisition of software startup Tukaroo is an example of the kind of small transactions the company expects to continue to make, CFO Steve Sordello said.

Small buys like this one, which was announced Wednesday, won't affect the company's financial results but are "strategically important" as it works to strengthen its technology position for the search industry's coming battles, Sordello told a New York conference.

Ask Jeeves, of Emeryville, Calif., will acquire the assets of closely held Tukaroo, a San Jose, Calif., startup which develops specialized search software. Tukaroo was incorporated in 2003 and has not yet released any products on the market.

Terms were not disclosed. The acquisition is significant because it gives Ask Jeeves technology to allow consumers to quickly search for e-mails and files on their computers' hard drives.

Ask Jeeves' rivals are rushing into this area. Terra Lycos, the Internet unit of Spain's Telefonica SA, in March launched HotBot Desktop, free software that does that, besides handling Web searches.

Analysts and search-software makers who have talked with Google say they expect the company to release it's own desktop search tool before long.

Microsoft Corp.'s new search technology, expected later this year, will include improved ways of combing the hard drives of PCs. Microsoft is also building such functions into the next version of Windows, code-named Longhorn, due around 2006.

In January, Tukaroo said it had completed technology for fast searches of files on a user's hard drive, local networks, and the Internet. It said it had developed so-called toolbar software to run on a user's computer.

Tukaroo also said it had come up with a new, better way to organize search results and a system to serve up advertisements to users.

Tukaroo was founded by Creighton Chong and Jeffrey Sidlosky, who have joined Ask Jeeves' staff.

Sordello told a conference hosted by Deutsche Bank that Ask Jeeves believes that technology will become an "even more critical component" of a competitive equation that also includes a fight for user traffic and advertisers targeting those users.

Ask Jeeves, which is now the No. 7 Web property based on users, has proprietary search technology, but gets advertisers through a partnership with Google.

Shares of Ask Jeeves closed at $38.45, down $2.17, or 5.3 percent, Wednesday on the Nasdaq Stock Market.

Source: Yahoo Finance

Posted by nakul at June 17, 2004 05:13 AM | TrackBack