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Apple develops content indexing and search technology

Apple Computer focusses on search technology, as it develops a new content indexing and search engine planned for Mac OS X 10.4.

During Steve Jobs's keynote presentation for this week's Worldwide Developer Conference, Jobs took the wraps off the new technology, titled "Spotlight", and compared it with the database file system Microsoft has promised for its 2006 Longhorn release.

Noting that Spotlight and Tiger will arrive a year ahead of Longhorn, Jobs quoted one of the promotional banners Apple had hung outside the auditorium: "Redmond, start your photocopiers."

In some respects, Spotlight resembles a capability originally planned for Mac OS 8 under the name "Live Folders." Like that earlier Apple project, it lets users create "smart folders" based on a query against a metadata index of all the mounted drives on a Tiger system.

But the search engine also works contextually within applications such as Apple's Mail, Address Book and System Preferences—and Apple is giving developers at WWDC a software development kit to help them build Spotlight into their own applications.

Every file stored in the Tiger file system will be mined for metadata and indexed accordingly on the fly, making it instantly searchable by keyword. And developers can add their own metadata definitions—for example, searching on "Wi-Fi" within System Preferences causes the network-settings icon to be highlighted.

Apple also previewed a new visual scripting tool for Tiger, called Automator. The script builder, which currently has a library of more than 100 configurable "actions" it can automate within the Tiger OS and current Mac OS X applications, can also be used to build workflows and tie together application events with custom AppleScript and Unix shell-script macros.

Automator can also drive Spotlight searches and act on their results, automating tasks such as sizing and uploading images found with a user-entered search string.

Developers at the show were generally upbeat about the new features, even if they weren't entirely surprised. "Most of this was expected," said Bo Holst-Christensen, a computer scientist with Cutisan Laboratorium A/S of Denmark. "And some of this [like Spotlight] is old Copland material, so it's about time."

Spotlight "will definitely affect the way we handle the development of our next Macintosh version of our software," said one software engineer from a major cross-platform publishing software company who asked not to be identified. He said his company is focusing on leveraging more of the native elements of Mac OS X in future releases of its applications.

But others who build applications across multiple platforms were less enthused. "There's nothing [Jobs] said that really affects us," said Steve Poole, a development manager at WRQ Inc. of Seattle. "We're doing our cross-platform development with Java."

At the same time, Poole noted, "We've had people make Mac OS their primary development platform. I feel crippled when I sit at a PC now."

Source: eWeek

Ad agencies find SEM challenging

Traditional advertising agencies find that search engine marketing is really difficult. Not only is it more complicated than it would appear, but it's also difficult in making it profitable.

Companies offering keyword bidding tools have lulled some agencies into a false sense of confidence. "Our bidding tool will make search engine marketing effortless," they were told.

What these companies didn't tell the agencies was that they still needed search engine marketing expertise to use these tools effectively to maximize their clients' results.

As a result, many big, traditional ad agencies-and even interactive agencies-hate search engine marketing. Here are the top five reasons why:

1. Achieving profitability in managing clients' paid search advertising is extremely difficult: If you don't use a bid management tool, and if each of your customers doesn't spend in excess of $50K per month on paid search advertising, you won't make money. Period.

Trouble is, even many of the large client companies who employ agencies cannot justify spending more than $3K to $10K per month. The conversions aren't there; the keyword query frequency is not there. Charging a service fee of 20 percent (a typical pricing model for PPC management) on top of a monthly PPC spend of $3K is peanuts for the time necessary to do a good job. But ad agency clients are clamoring for search marketing: they know it works; they know they have to be in the game; and they want their agencies' help. But trying to do SEM is breaking the agencies and they know it.

2. A shortage of skilled SEM practitioners: Employees with even a few years of search engine marketing experience are hard to find and expensive! Most are groomed at search-engine-marketing-only firms. Without experienced staff, an internal training program won't succeed. Without an in-house training program, you won't develop experienced staff-presenting a catch-22.

3. Even "poaching" experts cannot produce superior results: If an agency lures away a few ex-SEM-firm types, they join the agency ill-equipped to deliver results. Much of the intellectual property and knowledge that made them successful were contained in the tools that the SEM specialty firm developed in-house. Most, if not all, of the tools that made these employees efficient, speedy, and successful are not commercially available.

SEM firms have spent the last six to seven years building proprietary tools that provide enormous leverage to staff. These tools evolve and grow with the organization, and because they are enterprise-based application suites, they don't leave with the employee.

4. SEM is so complex it requires singular focus. Performing effective SEM requires practitioners to deal with 10 or so search properties who are always changing database partners, algorithms, PPC bidding rules, and paid inclusion programs. Keeping up on it all requires a dedicated focus. There's a significant learning curve every month. Most agencies are not built to manage that much change, that much data, and constantly evolving best practices, strategies and tactics.

5. SEM requires a commitment to research: The biggest breakthroughs in process improvement come through data intensive research and analysis of linguistics and search engine user behavior. This requires collection of data and results for millions of visitors in a variety of verticals with a variety of online marketing objectives for their sites.

In the same way that most agencies didn't build direct marketing capabilities in the 1970s, because the practice was too data dependent and mathematically based, most agencies do not want to be bothered with the ongoing research and analytics necessary to make SEM effective.

With all this being said, some agencies have decided to partner with SEM firms and are letting the SEM firms have direct client contact. Why? Because there is too much education required for the agency to deliver the work required and yet the agency wants to successfully meet the demands of its clients.

But most agencies still hate search engine marketing. So they can curse the wind or adjust their sails.

Source: Mediapost

Major changes in the local search segment

The Kelsey Group today is slated to deliver an analysis of the major changes that it predicts will happen in the local search segment.

The market research firm anticipates seeing a flow of advertising dollars from small businesses with very small ad budgets, and little to no Web presence.

The report comes on the heels of Overture's introduction Tuesday of Local Match, the Yahoo! company's local search product for advertisers and Web publishers. Recent initiatives by Google, Overture, FindWhat, and interactive Yellow Pages (IYP) provider InfoSpace have shifted the search spotlight somewhat from paid search to local search.

"Local" is the next major advertising keyword expected to open the online media floodgates.

Local media spending in the United States is over $90 billion annually, according to Robert Coen, Universal McCann's senior VP and director of forecasting.

The Kelsey Group says that $22 billion of that spend comes from small- to-medium-sized enterprises (SMEs). SMEs comprise 98 percent of all U.S. companies--some 22 million enterprises. These are the advertisers that the new report--"'Local Match' Expands the reach of Geotargeted Search"--says will be the most difficult to lure online.

According to Kelsey Group analysts and report authors Greg Sterling and Neal Polachek: "Getting advertisers, especially small businesses, to sign on will be at least as challenging as building the back-end technology and getting distribution partners to make the necessary efforts to show consumers the way to a better local online shopping experience."

Sterling notes that paid search is on track to generate $3.5 billion by 2004. By 2008, TKG projects local paid search to reach $2.5 billion. Other research groups, notably Jupiter Research, are less bullish over the revenue prospects of local search, as an air of uncertainty still hovers around the prospect of monetizing local search.

The TKG report notes that the Local Match feature that enables advertisers to build a paid search campaign without a Web site is "the most innovative aspect of the program," and adds that Ingenio and FindWhat are expected to launch similar product extensions in the third quarter.

However, a key question remains as to whether local--and primarily offline--businesses with small ad budgets will adopt local search because of Overture's new product offering.

TKG notes that history is not on Overture's side.

"In all probability, a business that is ready to undertake a search engine marketing campaign, or at least understands its potential benefits, is already going to have a Web site," the report states.

It also indicates that the adoption curve of Internet advertising suggests that a Web site presupposes a paid search marketing campaign; this was true because it was impossible to run a search campaign without one. Essentially, it remains to be seen whether the new product offering will be effective or not.

However, recent data collected by TKG and ConStat, Inc. from the Local Commerce Monitor shows that 61 percent of small businesses are convinced that the Internet "represents a big opportunity to target and acquire new customers."

But local usage is still far from critical mass, according to local search and IYP industry panelists at TKG's "Drilling Down on Local Search Conference" in March. The report states: "Without exception, the panelists, which included executives from Yahoo!, America Online, AskJeeves, and InfoSpace, said that local search still 'wasn't ready for prime time.'"

Report authors Sterling and Polachek note that "organic" growth for local search will take time, although February 2004 TKG data showed a 44 percent increase year-over-year in consumer searches for local business information.

Meanwhile, Overture, Google, and others face the problem of driving sufficient traffic to local advertisers and educating SMEs about the benefits of local search. The report states emphatically: "TKG believes that at some point, somebody's going to need to do some major marketing around local search."

Source: Mediapost

Google needs to fight spyware

Tim Yu, a Stanford University student, recently found that one of his family's computers was infected with a program called "BrowserAid/Featured Results," which was delivering additional and unwanted pop-up ads atop Google results.

He managed to rid the computer of that application, but a similar, unidentifiable program could not be eliminated.

"I removed it from the registry, but this one heals itself," Yu said. Spyware makers, he said, are getting more sophisticated.

And that's a problem for Google, as new strains of spyware attempt to profit from the highly popular search engine and its lucrative pay-per-click advertising program by altering search results pages or delivering pop-up windows with their own lists of text ads.

Spyware is a catchall term for software that installs itself on a PC without consumers' knowledge and that tracks computer usage, sometimes with criminal intent. A related breed of software, adware, is designed for less invasive, but more annoying, delivery of advertisements.

An entire industry of spyware and adware has sprouted up to take advantage of search engine ads, which are the most lucrative and fast-growing sector of online advertising. Sales from search advertising are expected to reach about $3.2 billion this year, up from $2.5 billion last year and just less than $1 billion in 2002, according to research firm eMarketer. Google alone is expected to rake in more than $1 billion from advertising this year.

The problem shows no signs of abating. A recent survey reported that nearly one out of every three computers scanned for Trojan horse programs or monitoring software like spyware was infected, according to security software maker Webroot Software. For some in the U.S. Congress, the threat is serious enough to warrant legislation designed to protect consumers.

Google in particular has drawn the attention of interlopers. Researchers for Lavasoft, which sells the popular spyware detection software Ad-aware, have identified one application that targets Google by altering the display of search results. The spyware, known as "Gloggle.Shing," carries a high threat level, according to Lavasoft, because the software installs itself in stealth mode when people visit certain Web sites, which the company did not name.

DestPatrol, another spyware fighter, has named "BrowserAid," along with many of its variants, as an application that affects search results. According to PestPatrol, the software installs itself via downloads from partner sites and delivers pop-up windows displaying ad links when a person searches at Google.

And at least one publicly traded Internet company is trying to distance itself from yet another spyware maker preying on Google and other major search providers.

LookSmart, an online search and directory service, said it recently investigated its business partners in an attempt to discover which company had disseminated its text ads over those of Google. The partner had apparently linked it to a Web site called Clickthrutracking.com without permission, allowing that site to display LookSmart text ads over the sponsored results of Yahoo and Microsoft's MSN, as well as those of Google.

The San Francisco-based company sent a letter in June to all of its partners, aiming to bar them from working with Clickthrutracking.com.

The company would not disclose the name of the offending business partner, which apparently owns the domain Clicktrutracking.com. According to Whois domain name records, the company is called Search Request and is based in Phoenix. Calls to business license authorities in Phoenix and Scottsdale, Ariz., do not reflect a company of that name or address operating in the state. The company's Web site is intermittently out of service.

"We have a blacklist of sites that (our partners) won't allow traffic from, and that list includes Clickthrutracking.com," LookSmart spokesman Dakota Sullivan said. "They will screen that traffic out, and if it slips through, we won't pay for the traffic."

LookSmart's temporary link to this distribution partner highlights the reach of spyware across the Internet industry. Untangling from spyware is becoming as hard for Internet businesses as it is for unsuspecting Web surfers.

The ranks of spyware and adware makers are on the rise, because the technology makes it relatively easy for someone to make money. Google, Yahoo and others collect fees from marketers each time people click on sponsored text ads. Marketers buy into the programs and bid for keywords in hope of reaching people who are searching for a particular product or service.

Major search engines and second-tier search providers distribute those text ads to third-party publishers and split the fees with them when people click. So if a spyware maker can arrange to place text ads over popular search engines, it is set to cash in.

"You would not believe the size and scope of the gray market in this arena," said Elliot Noss, president of Tucows, a downloads site. "It runs the gamut from light gray to dark gray."

The complexity of the ad distribution partnerships is illustrated in Yahoo's recent move to provide Web surfers with a tool to block spyware and viruses on the browser.

Yet the toolbar application does not block advertising software like that from controversial company Claria, formerly known as Gator and one of the largest providers of adware. Through its own tool called Search Scout, Claria delivers text ads from Yahoo's Overture Services in a pop-up window when people search on Google. As much as 30 percent of Claria's revenue is derived from Overture.

In another example of the cottage industry, Internet service provider 550Access.com introduced a toolbar in March that blocks certain ads from search results and replaces them with others.

Google also distributes its text ads to questionable areas of the Web through Applied Semantics, a company it bought last year. When Web site visitors type in a misspelled domain name, they might find a page of related sponsored ads from Google.

Google limited its comments for this story, citing its upcoming $2.7 billion initial public offering. But the company pointed to recent guidelines it published on its Web site regarding downloadable PC software and best practices for the industry to notify consumers of their tactics and give them a way to opt out.

Google has a stake in the business as a destination site that can be affected by third parties out to profit from control of the browser.

It's also an application provider that could be affected by legislation meant to ban types of spyware or adware. It develops the Google Toolbar and Deskbar, which help people access search results from a central point on the browser and desktop, respectively. The applications also "phone home" usage data to the company's server if consumers agree to let Google monitor their habits for the sake of improving the service.

Utah and Massachusetts have already enacted laws to restrict types of downloadable software from tracking users and delivering ads. But adware maker WhenU recently contested the Utah law and won a temporary reprieve.

"Google's goal is to provide users with the best search experience," according to a statement on the company's Web site. "We have recently published a set of software principles designed to foster discussion about defining and fighting spyware, and ultimately to contribute to a better user experience online."

Yet Google's IPO prospectus acknowledges--if briefly--the threat facing the company: "New technologies could block our ads, which would harm our business."

Technology experts urge consumers to scan their machines with security or anti-spyware software regularly. Programs they suggest include PestPatrol, Ad-aware, and Spybot Search & Destroy.

"Consumers should be aware of the applications and files residing and running on their machines," said Matt Cobb, vice president of core applications at Internet service provider EarthLink.

Danny Sullivan, editor of industry newsletter Search Engine Watch, said he's had several reports of adware that obstructed Google results over the last six to eight months, and he suspects that there are several different strains.

"The bigger issue is that for advertisers, your paid listings can be distributed in all sorts of ways you don't know about," Sullivan said, "and you may not have a way to discover where they're going."

Source: ZD Net

Overture announces the launch of Local Match

Overture announces the launch of Local Match™, its new sponsored search product which delivers local search listings to consumers searching online for local products and services.

Through Local Match, advertisers can precisely target customers interested in a specific neighborhood and present customized offers and business details to them.

Overture's Local Match listings appear today in the U.S. on Yahoo! and MyCity.com and will be displayed on other popular sites including MSN, ESPN.com and certain sites within the InfoSpace network, including online directory sites Switchboard.com and InfoSpace.com and search sites Dogpile.com, WebCrawler.com, MetaCrawler.com and Excite.com.

Through its strong network of distribution sites, Local Match offers advertisers of all sizes -- including businesses that do not have a Web site -- the opportunity to reach consumers searching online for products and services in the advertiser's local area.

"Overture has built upon its core sponsored search product to deliver a highly relevant and precise local offering to businesses of all sizes, whether they have a Web site or not," said Geoff Stevens, General Manager, Local for Overture.

"The launch of Local Match marks yet another addition to our growing suite of integrated sponsored search offerings. As the product evolves, we are confident that both advertisers and consumers will realize the significant value of the highly targeted marketing and incredibly relevant search experience enabled by Local Match."

"Local search represents a very significant opportunity for both small and large advertisers, as consumers go online to find local business information," said Greg Sterling, program director for The Kelsey Group.

"Our research shows that slightly more than 25% of commercial searches performed by online buyers today are local, and we expect that figure to grow over time as local search capabilities continue to improve."

Local Match enables advertisers of all sizes to precisely target customers who are searching the Web to find products and services from a local provider. Specifically, advertisers have the ability to pinpoint a geographic area surrounding their business (between 0.5 to 100 miles) in which they would like their search listing to be shown.

For example, an electronics store in Austin, Texas could choose to have its listings displayed only to users searching for "DVD player" within a five-mile radius of its location. Similarly, a large national consumer electronics retailer could use Local Match to tailor its listings and discounts to customers who are looking to purchase items at specific local stores.

In addition, for businesses that do not have a Web site, Local Match provides a customizable business information page that offers key details about their business, such as a street address, phone number, payment options, hours of operation and a dynamic map.

Local Match is available today in the United States directly through Overture (http://www.overture.com) and will also be offered through select directory partners and online marketplaces.

Source: ZD Net

Yahoo-Trillian conflict has users very angry

As the Instant Messaging wars escalate again, consumers are claiming they're the casualties.

Yahoo on Wednesday evening began blocking third-party instant messaging clients in what it claimed was a "pre-emptive" action against IM spam, or "spim."

Just a few hours after Yahoo changed its instant messenger protocols, Cerulean Studios issued a patch to allow users of its popular Trillian software to connect again with users of Yahoo's messaging program.

For people who use popular third-party messaging clients such as Cerulean's Trillian, or smaller services such as Gaim, the reaction was instantaneous and negative. Speculation began flying about whether battling spim, currently a minor issue, was Yahoo's true intention.

"This is just Yahoo's attempt to stifle progress," one person wrote on CNET News.com's message board. "Trillian brings the IM worlds together. Why does (Yahoo) keep splitting it apart and saying it's to increase 'security' on their network?"

Regardless of intention, Yahoo's management of its IM network preserves the network's exclusivity. Like Yahoo's service, other major messaging services such as America Online's AOL Instant Messenger and Microsoft's MSN Messenger are proprietary networks that cannot communicate with competing systems. People who have contacts on different IM services must launch multiple messaging clients to talk to everybody.

Historic battles between the Big Three of Internet services have been ugly. In 1999, AOL and Microsoft engaged in a public spat after MSN Messenger launched with the ability to chat with AIM users. AOL considered Microsoft's action a "hack" into their systems and blocked MSN.

Microsoft eventually relented, but the block would later haunt AOL. A coalition of companies led by Microsoft launched an aggressive lobbying campaign to point out AOL's unfair IM market dominance when AOL was trying to acquire Time Warner. Yahoo was part of that coalition.

What Trillian and other third-party providers do is combine multiple buddy lists under a common interface. But that interface means Yahoo, AOL and MSN can't differentiate themselves via features such as emoticons. They also can't serve advertisements or direct users to other areas of their site networks.

"I don't think security is the biggest driver behind this" decision, said Genelle Hung, an analyst at market researcher The Radicati Group. "It's not something that Yahoo is really as concerned about as keeping its user base loyal."

Yahoo remained firm with its assertion that third-party providers are a spim threat to Yahoo Messenger users.

"Spammers are being aided by entities that are accessing our systems without our consent," said Yahoo spokeswoman Mary Osako.

A Cerulean representative did not respond to repeated requests for comment.

Some analysts support Yahoo's decision. They point out that though spim remains a minor problem, e-mail in its early days also saw few issues with spam.

But the spam problem has gotten worse every year. E-mail providers such as ISPs and Web sites have been forced to devote significant resources to battling spam and filing lawsuits against alleged spammers. Consumers themselves have clamored for companies to do more to battle the problem.

"By the time spim becomes a problem, there's not much to do about it," said Michael Gartenberg, an analyst at Jupiter Media. "You're in reactive mode."

One developer who works on Gaim, an open-source IM integrator like Trillian, expressed dismay that its users were blocked. Still, he supported Yahoo's move to stop spim before it starts.

"If Yahoo's motives are true, if they are honestly trying to help solve a spam problem, more power to them," Christian Hammond, a Gaim developer, said in an e-mail response.

In the meantime, Yahoo's Osako said consumers will see "frequent protocol changes" should third parties continue hurdling its blocks. In the meantime, angry Trillian users will keep pointing fingers at the Web giant and claiming foul.

"They should be honest with the public and explain (that) their beef with third-party software is potential lost advertising revenue, rather than pretending it is part of some noble antispam quest," wrote another News.com message board contributor.

Source: C-Net News

Microsoft will improve its search capabilities for July

Microsoft plans to improve its search capabilities from July, as it looks to compete with heavyweights Google and Yahoo, Microsoft chairman and chief software architect Bill Gates said today.

Gates told a media briefing in Sydney the company had "several milestones with its search site" on the way.

"In July, the format of the site will change -- and so will the quality of what you get -- and the way it'll look is dramatically improved," Gates said.

"It'll be later this year that we actually roll out what's entirely our own back end driving the search".

Gates said the way search was currently done was "very low-tech," based around taking "a bunch of words and making an index.

"You're not actually understanding the documents and so some of the false hits you get are almost humourous," he told journalists. "A human would not make those mistakes because a human can understand the document".

Gates said Microsoft had been doing linguistic research for more than a decade "that actually lets us parse and understand documents.

"That's where you can bring in the idea, don't show this person a restaurant if it's not nearby [or] don't show this person something about … potato chips if they mean computer chips.

Gates said search moving forward encompassed personalisation, understanding local information, being able to parse in to the semantics of a document, being able to browse databases and being able to attach domain knowledge.

"Say if I want to know if a flight is on time. "Generic Web search today is actually terrible for that, but we should be able to look at your query and say hey, that's a flight number and give a response that's basically just a direct answer to the question, not a list of random Web sites".

He described Google and Microsoft as being "fairly unique" in the way they both hired a lot of computer science Phds. "So the rate of improvement between us and them will be highly beneficial to the consumer as we compete".

Source: ZD Net

AOL signs agreement to acquire Advertising.com

America Online, a unit of Time Warner, said it signed a definitive agreement to acquire Advertising.com, a provider of interactive marketing services, in a $435 million all-cash transaction.

Advertising.com operates the industry's largest third-party advertising network, reaching more than 110 million visitors monthly and over 70 percent of all U.S. Web visitors, according to comScore Media Metrix in May 2004.

The company's revenues increased almost 80 percent in 2003 to reach $132 million, and 2003 income from operations was $12.1 million.

Advertising.com will remain in Baltimore and will be managed as a separate company reporting to Michael J. Kelly, president of AOL Media Networks. The company has more than 300 employees and operates principally in the United States, with operations in the United Kingdom, France, Germany, Norway, Sweden and Denmark.

America Online expects to close the transaction in late summer 2004, subject to regulatory approvals.

Advertising.com works with more than 800 advertisers to optimize the performance of their online marketing campaigns through proprietary ad delivery and optimization tools.

Advertising.com also works with more than 1,500 online publishers by providing a large and consistent customer base for their available advertising inventory and by licensing its ad serving technologies.

Jonathan Miller, chairman and CEO of America Online, said, "Advertising.com has built a profitable, scalable and highly attractive business. This acquisition is a strategic move that will bolster AOL's advertising business, building on the strides made in the past year."

Source: Forbes.com

Merrill Lynch drops out of Google's IPO

Merrill Lynch dropped out of the list of underwriters taking part in the upcoming initial public offering of Google, mostly out of concern that the fees it would generate wouldn't be worth it.

Early Monday, Google, the Internet search engine based in Mountain View, California, disclosed that Merrill Lynch wouldn't be one of the firms that would allow clients to bid for shares in Google's initial public offering, which is being led by Morgan Stanley and Credit Suisse First Boston.

It was Merrill Lynch that decided to take a pass, according to people familiar with the syndicate put together to sell the shares, because of the amount of money Merrill Lynch stood to take in from customers who were awarded allocations.

"The fees are too thin," said one institutional investor who is a client of Merrill Lynch and other firms planning to sell shares in the deal. "It wasn't worth the trouble."

A Merrill Lynch spokeswoman declined comment. Underwriters who don't get the coveted lead role in an IPO often settle for far less in fees than other banks. Typically, companies going public pay about 7 percent of the size of the offering in fees, and most of that goes to the lead underwriters. Other firms in the syndicate of banks get less in fees, but also distribute fewer shares.

Google's IPO, though, is anything but conventional. The company has insisted on an auction-style sale for its shares, and, though fees haven't been disclosed, they're likely to be low even for the lead underwriters, let alone those lower down the list of bankers. Instead of a 7 percent fee, some bankers believe the total fee could be around 3 percent.

What's more, other firms involved in the deal could, in theory, handle the sale of more shares than the lead underwriters if a lower-level firm's clients bid at the right price and right size to win shares. That could mean those lower-tier firms are handling more of the risk in placing the shares and paying more of the administrative costs of handling the offering, and getting paid less than other firms.

Source: Taiwan News.com

Lycos receives 4 offers for its US portal Lycos

Spanish Internet firm Terra Lycos has received four offers for its U.S. portal Lycos, a company source said on Tuesday.

"We are weighing the sale of Lycos. No decision has been taken yet but Terra has four offers and we expect a decision will be taken in the short term," the source told Reuters without giving further details.

Terra, a subsidiary of Spanish telecoms giant Telefonica, bought Lycos for $12.5 billion in an all stock deal in May 2000, near the height of the Internet boom. Its book value today is 75 million euros ($91 million).

Terra, Europe's third largest Internet service provider, posted first quarter earnings before interest, tax, depreciation and amortisation (EBITDA) of 0.7 million euros, its second quarter of positive EBITDA after years of losses.

It expects to make its first net profit next year. Despite the huge drop in Lycos's value since Terra bought it, the sale of the U.S. unit could have a positive effect on Terra's earnings as the Spanish firm wrote off goodwill on the initial purchase in 2002, the source said.

The same source said Terra does not plan to make an offer to buy out small shareholders and delist the stock in the short term.

Telefonica, which owns 75 percent of Terra, launched a bid for 100 percent of the Internet firm last year but had to abandon the full takeover as small shareholders were reluctant to part with their Terra stock at the price offered.

Lycos is undergoing a restructuring to turn itself into a paying subscription site. It said in February the process would affect 20 percent of its staff in the United States.

At that time, it had 420 U.S. staff. The company source also confirmed media reports that Terra would increase the services it offers through an accord with search engine leader Google Inc.

The source did not give any further details on the proposed deal. The source said the accord would increase Terra's revenues and help it reach its objective of a positive operating result this year and a net profit in 2005.

Shares in Terra Lycos were up 0.8 percent at 4.97 euros at 0940 GMT.

Source: F-T.com

Google might publicly release some of its software code

Google is preparing to publicly release some of its underlying software code, only months before it undertakes a multibillion-dollar stock-exchange float.

The revelation comes as Google considers Melbourne for the home of a regional research and development centre in an effort to triple its global workforce over the next 12 months.

The time has come for Google to "give something back", Wayne Rosing, the company's vice-president of engineering, told students while on a recruiting drive in Melbourne last week.

"There have been a lot of conversations in the company in the past two months about (how) . . . it's time for us to give something back. So our technical director, Craig Silverstein, has started a project to look at all the Google code and start figuring out what parts of it we want to give back," Rosing said.

"I'm not saying we're going to open-source Google, because that would be a little dumb when we have these Microsoft guys making noise," he said, referring to the practice of giving away the raw computer instructions to a software program.

He says it isn't fair for Google to draw smart people from all over the world and "just keep it all for ourselves".

"We need to have the tools out in the universities so the next generation can build on our work, too."

Google is making a policy decision to be more open, said Craig Nevill-Manning, director of engineering at the New York office, the other Google visitor.

"We're encouraging the software engineers to submit papers where it makes sense, particularly where it is landmark work and it is really important that other people know," Nevill-Manning said.

Rosing and Nevill-Manning were on a whirlwind recruitment drive, canvassing postgraduate students from RMIT and Melbourne University on Thursday night before presenting a seminar on Friday.

Google was in town to "assess the local talent", Rosing told the Thursday night gathering. "We could consider opening and looking for sites here. We're looking for a critical mass of talented people."

His audience was mainly software engineering students but the address also attracted some linguistics and statistics students - as well as those who sneaked out of work early in search of a new job with the dotcom star.

Later, Rosing told delegates he was using the night to gauge the viability of a local office and was "very excited" about the turnout of more than 200 people - the same number Google attracted to a similar night in New York.

He said Google will triple its workforce from, 700 to 2100, during the next 12 months.

The next day it was standing room only as Nevill-Manning addressed a 360-seat lecture theatre packed with Australia's industry and academic digerati - including representatives from Microsoft, Sensis and CSIRO - crammed alongside eager postgraduate students.

Google's consideration of an Australian research presence is "another tick in the box for Australia", said Australian Computer Society president Edward Mandla.

"Google is one of the companies that is leading in technology, and I think young Australians who are studying want to get their hands on the latest technologies and help develop the latest technologies.

"We've got to attract multinational companies here to set up research centres and to take advantage of Australia."

Victoria's Minister for Information and Communication Technology, Marsha Thomson, says Google's interest in Melbourne proves Victoria's ICT industry is on the right track.

"The recent Meta report found that Australia was second to India in attracting offshoring work from the US, and Google's interest is confirmation that we are achieving our goal of having a highly skilled ICT workforce," she says.

Source: F-2 Network

Harder to distinguish between regular and paid results?

There will soon be a report published by a consumer panel that concludes searchers find it harder to distinguish between paid pay-per-click text ads and regular (organic) search results.

In a discussion on "Building Trust on the Web" under the Consumer WebWatch's April summit on Web credibility, Leslie Marable of Consumer WebWatch told that according to one study of April last year 60 percent of the consumers they polled "had no idea that some search engines charged fees in exchange for prominent placement of search results."

It should be added that since then several search engines have started designating their pay-per-click search results more clearly, not at least because of pressure from the American Federal Trade Commission. This was clearly one of the reasons Consumer WebWatch commissioned a new study.

The new study is not based on a phone survey like the previous one. Instead Consumer Webwatch has opted for an anthropological/ethnographical in-depth study of 17 people.

It turns out that all participants were surprised when they learned about pay for placement -- even the more "advanced" Web users.

Search sites often mark paid results as "sponsored". One participant noted that "A sponsor is someone who gives money to support programs," and he did clearly not read this to mean "paid text ads".

This is not a representative survey. You need more than 17 respondents to achieve that. Still, we would not be surprised if a majority of searchers are unable to distinguish between pay-per-click text ads and regular search results -- especially when the text is formatted and presented in a similar way.

Does it matter? Well, a cynic may argue that "what they do not not won't hurt them" -- as long as they find relevant results that is.

Both Overture and Google AdWords spend a lot of resources on ensuring that the paid text ads actually are relevant -- not only to avoid complaints from organizations like the Consumer WebWatch, but also in order to make advertisers happy. Relevant text ads results in more click-throughs and higher conversion rates.

But there is also the question of credibility. If this marks the start of a new debate on the legitimacy of pay-per-click text ads, the search sites may get hurt, as these ads have become one of their most important sources of revenue.

Moreover, the success of a site like Google is built on a good reputation, and Google cannot afford to loose that.

Google has actually done a lot to distinguish the text ads from regular search results, placing them i colored text boxes set apart from the rest of the listings. However, they are still called "Sponsored Links".

So why don't they just call the adverts "Adverts"? Our guess is that they are afraid that this will cause a drop in click-throughs and lower revenue.

In the long run, however, the risk of more bad publicity may make that a more sensible option.

The searchers may like it as well. This especially applies to those that are searching for information instead of goods and services. People who want to know more about how to grow a lush lawn are not always looking for fertilizer.

Source: Pandia

Yahoo launches Chinese-language search portal

Yahoo launched a Chinese-language search portal on Monday, following Google's lead for a stronger foothold in one of the world's biggest Internet markets.

The introduction of Yahoo's new Web site, www.yisou.com, follows Google's acquisition last week of a minority stake in Baidu.com Inc., China's biggest independent Internet search engine and one of Google's strongest rivals here.

"Yahoo believes the introduction of Yisou will help extend our reach into the rapidly growing search market in China," David Lu, Yahoo North Asia's vice president of search and marketplace, said in a statement.

Yahoo China already has a Chinese search company, 3721, which it acquired last year for $120 million.

Google has offered Chinese-language searches since 2000 and is hugely popular among China's more than 80 million Internet users --the world's second biggest Internet market after the U.S.

Source: The New Nation

Ask Jeeves adds site preview tool

Search portal Ask Jeeves expands its Smart Search capabilities and adds site preview tool called Binoculars, making it easier and faster for users to find information.

The company has expanded its Smart Search features, which enable users to conduct more effective searches by helping narrow, broaden or more directly answer user queries.

Smart Search uses Ask Jeeves' combination of everyday language and structured-data search technologies.

Ask Jeeves' also introduced Binoculars, a patent-pending site preview tool, currently in beta launch, which enables users to preview their search results before clicking through to visit the end pages themselves.

The company said that a study conducted by VeriTest, a unit of Lionbridge Technologies Inc., concluded that Binoculars reduced the number of clicks required to find relevant results by 50-70 percent per search.

Source: Click Z

Find.com launches as a new business search engine

Find.com is a business search engine that delivers search results from three different types of sources.

Results from business sites that charge for their content, such as Gallup and Frost & Sullivan, appear at the top of the search results pages.

Users can then buy the content. Results from a list of 3,000 business sites appear in the free organic listings, along with results from a variety of search engines.

Find.com, a search engine designed for business professionals, was launched in beta this week by partners FIND/SVP, Empire Media and TripleHop Technologies.

"This is in line with the trend toward specialization we've seen over the last 6 to 12 months," said Peter Hershberg, managing partner of Reprise Media, a search marketing firm. "We've had quite a bit of success with alternative or vertical search engines because they reach such a specific audience."

Find.com also has implemented an innovative navigational scheme that's reminiscent of that used by clustering firm Vivisimo.

"In the upper-left-hand corner is a graphic you can use to organize results by topic and source, putting them into an organizational structure that makes the most sense for the user," Hershberg said.

Results can also be organized using tabs perched directly above the search box. Clicking on the "Research" tab causes only search results from the premium business sites, those charging for their content, to be displayed. "News" displays only news stories, "Directory" produces a searchable listing of sites by category from the open directory, and "Web" produces results from all three sources.

Established research and consulting firm FIND/SVP picked the paid subscription sites used for premium content, as well as the 3,000 business sites used for the free listings.

These sites, along with a number of search engines, are indexed by TripleHop Technologies. The third partner in the Find.com enterprise is Empire Media. This company will organize the advertising sales on the site, both sales done directly by Find.com itself and sales from third-party sales organizations. Empire will also do outbound marketing, advertising Find.com via channels including print and online.

Empire and FIND/SVP each own 47.5 percent of the business, with TripleHop taking the balance.

In developing Find.com, the partners relied on the results of a FIND/SVP study that 52 percent of business professionals are only "somewhat confident" that standard search results come from credible sources. The Internet study surveyed a random sample of about 300 professionals in April and May.

"Users can trust the results they find on Find.com because they come from trustworthy sources," said Chris Travers, CEO of Empire Media. "You can feel confident putting the information in a business plan, using it in a presentation to a client or showing it to your CEO."

There are two components to the site's revenue model, Travers said. When a user clicks on one of the premium listings displayed at the top of the search results, an intermediary Find.com page appears through which the content can be purchased. Find.com gets a cut of the revenue.

The site will also use advertising in multiple forms. Currently, sponsored listings from Clicksor are displayed on the right-hand side of the page.

However, the site will soon sell its own sponsored links using technology vendor Zedo, Travers said. "We will work with them to deploy keyword-based advertising," he said. The company will also work with two or three other keyword and contextual advertising groups, which Travers would not name. He did say that IndustryBrains "will be adding contextual advertising for us."

Also, Empire has a co-registration business, and is now investigating the possibility of using co-registration on Find.com, Travers said. He said the company has seen interest from advertisers but would not name any specific advertisers who might be coming on board.

"Their premium research is interesting because it's occupying the same space where we're used to seeing sponsored listings," said Hershberg, who felt this was a good idea.

Source: Click Z

Google considering support for RSS news feeds

Search engine giant Google is perceived at renewing its support for the popular RSS news feeds format in some of its search services, marking the latest turn in a standards war over technology.

RSS, or Really Simple Syndication, lets online publishers automatically send Web content to subscribers, giving readers a powerful tool to compile news headlines on the fly from several sources at once.

Next to Atom, which launched as a challenger last year, RSS has become a leading candidate to form the basis of an industry standard for an entirely new style of Web publishing.

In January, Google seemingly chose sides, bypassing RSS support for most subscribers of its Blogger publishing tool in favor of rival Atom. But now, there are signs that Google may be poised for a change of heart, as support has grown inside the company to restore equal footing to both formats.

According to an internal Google e-mail seen by CNET News.com, the company has been considering the change and last month assigned at least one staffer to write a memo summarizing technical details relating to RSS. The request came amid a broader discussion touching on extending RSS support for new Blogger subscribers and Google Groups, which supports Atom but not RSS in a test version of the service.

"I did ask (a Google product manager) to develop a summary...about RSS feeds, including the ways they are produced and consumed, which platforms/devices they run on, and information on the various formats (RSS 1.0, 2.0, Atom)," Jonathan Rosenberg, Google's vice president of product management, wrote on May 22. The message was part of a thread addressed to Google co-founders Sergey Brin and Larry Page, CEO Eric Schmidt and others.

As of June 4, it appeared no decision had yet been made on the issue. A Google representative declined to comment.

Were Google to support both RSS and Atom equally, it might help ease growing pains for a swiftly rising movement of Web publishing. It would also restore Google to the status of a neutral party in the midst of a bitter fight between backers of RSS and Atom, who have been divided since last summer when critics of RSS banded together to create the alternative format. Since then, many blog sites and individuals have rallied behind Atom.

Google is central to the debate because of its mounting influence in the online community and within Web publishing circles as the owner of Blogger.

The Mountain View, Calif.-based company, which is gearing up for a $2.7 billion initial public offering later this year, recently redesigned Blogger with simplified features to help newbie Web surfers publish regular accounts of their lives online, a move to appeal to wider audiences.

Google also has plans to introduce a raft of community services, including e-mail discussion groups (Google Groups 2), free Web-based e-mail and search personalization tools, which could eventually tap the syndication format.

A slew of feed readers or news aggregators has emerged to take advantage of the technology and spur consumer demand. Newsgator, for example, lets people subscribe to various Web logs and news sites and have the feeds delivered to their e-mail via a plug-in for Microsoft Outlook, at a cost of $29.

Topix.net lets people parse news into 150,000 different categories, even down to a ZIP code, and create their own information site. Pluck recently released a set of browser add-ons for Microsoft's Internet Explorer with an RSS reader. Many news readers support both RSS and Atom, although some support only one or the other.

Despite the fissure, RSS has been gaining allegiance among many computer makers and online publishers. In recent weeks, Time magazine, Reuters, Variety.com and Smartmoney.com have started supporting the format, syndicating their headlines to news aggregators and individuals.

In January, Yahoo started testing RSS feeds, allowing visitors for the first time to create personalized MyYahoo pages with automatic news feeds from third parties of their choice. Yahoo also supports Atom feeds. Computer companies including Microsoft, Apple Computer and Sun Microsystems also support RSS.

Two major versions of RSS currently exist. They are known as RDF Site Summary and Rich Site Summary, respectively.

The technology is becoming more important because it essentially allows Web surfers to get information how and when they want it, without surfing to Web sites.

People can set up a Web page and aggregate headlines from multiple sites, and click only on those that interest them. Publishers are embracing the technology to drive more traffic to their sites, amidst media overdrive on the Web. Many publishers and advertisers are even evaluating ways to make money from syndicating news feeds with ads or sponsorships. For example, publishers could seed advertisements into RSS and Atom news feeds.

Yet without interoperability between the news readers, consumers could eventually hit a brick wall. If a publisher's syndicated news feeds are available only in one format, then the consumer using another would have to install an updated news reader.

"From a layman's perspective, if this is going to move out of the geek space, these two warring parties need to come together and realize it's the applications that will determine the standard," said Charlene Li, principal analyst for Forrester Research. "It shouldn't be polarized into a Betamax vs. VHS discussion."

RSS was developed as a Web scripting format in the late '90s by a team of Netscape engineers and eventually came under the domain of Dave Winer's blog software company, Userland, when Netscape's RSS team disbanded.

Last year, Winer transferred the format to the Berkman Center for Internet & Society at Harvard Law School, where he is a fellow. RSS is also now available for use under a "creative commons" license, which frees it from commercial copyright claims.

Sam Ruby, an IBM software engineer, launched Atom last summer as a way of bypassing what he and other critics called Winer's de facto control over RSS. Industry watchers say the format is more robust than RSS, with more tagging capabilities in syndication, and is more promising because it's on a fast track to becoming an open standard.

Atom backers have proceeded with plans to bring their technology under the auspices of the Internet Engineering Task Force (IETF). Detractors of RSS argue that the format is closed because it is essentially governed by one man, Winer.

In May, the Internet Engineering Steering Group (IESG) announced a proposal for a new IETF Atom publishing format and working group under the IETF. Ruby and others have said that the working group would draw on the experience of RSS to help create a single, interoperable format. Ruby could not immediately be reached for comment.

Winer himself has lobbied for a merger of the rival formats, in part because of concern that Google's dominance would influence a greater split in the Web publishing industry.

In a worst-case scenario, Winer described how in the future, people might need to download two different news reader applications to compile headlines from publications supporting competing formats.

Winer said that he's asked the company repeatedly to get behind RSS and quell confusion over competing formats, with no answer.

The "RSS 2.0 format is by far the most widely used format. There was a time when it looked like things would coalesce, but then things started to fragment, largely due to Google," Winer said. "RSS deserves Google's respect, and it's not getting it."

Source: C-Net News

Wanadoo not clearly identifying sponsored links

French ISP Wanadoo argued before the UK's Advertising Standards Authority that all sponsored links at its web site were clearly identified as being delivered by Overture, by a link at the foot of each sponsored search result.

Freeserve plc has been told by an advertising watchdog that search results on its web site, now re-branded as Wanadoo, must clearly identify sponsored links following a complaint that its rankings are based on the sums paid to search advertising company Overture, not relevance.

Clicking the Overture link would open a window with the following text:

-- "Overture ranks its Advertiser Listings based on the amount the Websites bid, with the highest bid amount at the top of the search listings. Websites pay Overture the amount shown on www.uk.overture.com next to the Advertiser Listing, when a user clicks through to their Website."

The ISP said the sponsored results were all checked manually for relevance to the search criteria and the most relevant results always appeared first. It argued that because advertisers had to pay each time a consumer clicked on their search entry, it was in their interests to appear only in relevant search results.

A visit to uk.overture.com reveals that Singers Outdoor bid up to 30 pence per click-through, eBay 26 pence and LXDirect.com 25 pence.

The ISP said it did not believe its web site was misleading or its search results were less relevant because they showed sponsored links first. It said it would add a link to its search page that consumers could use to find more information about how its search engine service worked and how results were ranked.

But it seems that this promise was insufficient for the ASA, which became involved following a complaint from the head of web design firm 2-Minute-Website.com. “I contacted the ASA on behalf of all our small business clients”, said Managing Director, Andrew Ellam.

“Since they pay less than a hundred pounds to get their website, they can’t afford to spend hundreds on advertising - and they shouldn’t have to," he continued. "Consumers are likely to be fooled into thinking these adverts are unbiased search results, and small businesses who should appear in the listings are suffering”.

The ASA noted that each sponsored link on Freeserve's site had a hyperlink to an explanatory pop-up box and sponsored links were identified by the Overture hyperlink.

However, because sponsored links were not clearly identified by a headline or title, and the search page did not contain an explanation of the purpose of the hyperlink, it considered that consumers were unlikely to realise that the Overture hyperlink indicated that results were sponsored and concluded that "consumers could be misled."

It asked the ISP to ensure that sponsored links were clearly identified in future.

This follows the CAP Code, the ASA's rule book, which states that "marketing communications" should be "designed and presented in such a way that it is clear that they are marketing communications". Another rules states that marketers "should make clear that advertisement features are advertisements, for example by heading them 'advertisement feature'."

The ruling is a clear endorsement of Google's approach: Overture's biggest rival clearly marks all 'sponsored links' in search results as such.

This UK ruling will likely be of less concern to Overture itself. Its biggest search partner is its parent company, Yahoo!, and a search on Yahoo!'s UK site already separates 'Sponsored Results' from 'Web Results'.

While the ASA ruling is in the name of Freeserve plc, the brand launched by High Street retailer Dixons, the ISP was re-branded as Wanadoo in April. Wanadoo, part of France Telecom, bought Freeserve for £1.6 billion in December 2000. The complaint to the UK's Advertising Standards Authority was made two months before the re-branding.

A spokesperson for Wanadoo told OUT-LAW.COM that the company is looking into today's ruling "with interest" but that the company has no further comment at this time.

ASA spokesperson Donna Mitchell said consumers "need to know when advertising is advertising" and warned that today's ruling applies to the industry as a whole. "Anyone who doesn't currently clearly identify their sponsored links should do so now," she said.

Andrew Ellam said he has contacted the ASA about a number of other UK search engines and asked it to issue UK guidelines to correspond with those in the US, where the Federal Trade Commission demands that search sites make ‘clear and conspicuous disclosure’ when advertisers have paid to appear in their results.

Ellam said that a check of the UK's top 20 search sites indicates that 13 may have similar problems to Wanadoo.

Source: Out Law.com

Yahoo cancels corporate instant messaging

The cancellation of Yahoo Messenger Enterprise Edition marks the end of the Web portal's now-defunct enterprise software division.

The unit was created in 2000 to sell customized Web portals and video conferencing services for internal use in corporations. But in October 2003, Yahoo scrapped the division and melded its businesses with their consumer counterparts.

Yahoo confirmed on Thursday that it is no longer selling a version of its popular instant-messaging service for corporations, ending the Web portal's attempt to sell IM as a software package.

In an informal interview earlier this week, Yahoo's Chief Information Officer Lars Rabbe said the enterprise instant messenger was shelved, because Yahoo is largely a consumer company and not structured to take on the kind of support tasks and other responsibilities that come with selling corporate software.

The move will consolidate Yahoo's consumer and enterprise products into one product package.

"We have reorganized our instant-messaging business to optimize our ability to leverage the Yahoo network, whether our customers are at work or at home," Lisa Pollock Mann, senior director of Yahoo Messenger, said in a statement.

A Yahoo representative declined to comment Thursday on when the company had stopped selling the service.

To the Big Three Web portals--Yahoo, Microsoft's MSN and America Online--selling IM to companies has sounded like a good idea. The companies all offer popular, free IM clients that millions of Internet users have downloaded. IM technology lets people exchange messages in real time, and it has evolved features that let users play games, make phone calls and hold video conferences.

Instant messaging has made its way into companies as well. Some 85 percent of all enterprises in North America use a form of IM in their networks, according to a survey by research firm The Radicati Group. This penetration was mainly spurred by employees downloading Yahoo, AOL or MSN software to keep in touch with personal and professional contacts.

However, IM flourished in businesses without the oversight of corporate information technology departments, leaving many system administrators concerned about IM's safety against viruses. Some industries regulated by the federal government, such as the financial services and health care industries, are concerned that the use of IM in their offices might violate compliance or privacy laws.

The Big Three saw in this an opportunity to sell adapted versions of their free service to companies. The revamped software included features such as conversation logging, authentication and identity management. The companies also partnered with third parties such as IMLogic and Facetime Communications to add these applications to their IM products.

But consumer Web companies often have a hard time becoming enterprise software vendors, some industry watchers have noted.

"The market has shown that you cannot bring continuity from the consumer market to the enterprise market," said David Gurle, an executive vice president of Reuters Messaging. "You need to think about the enterprise market very differently than the consumer market, which doesn't pay you directly."

In addition, experienced vendors such as IBM and Sun Microsystems have begun offering their own IM products through their established sales channels.

Like Yahoo, AOL has retrenched its enterprise IM division. It has opted instead to sell add-ons such as video conferencing for a fee. Microsoft has focused less on MSN Messenger and more on its Live Communications Server--which combines IM, Net phone calling and video conferencing--as its enterprise communications product.

Source: C-Net News

Adsense program extended to smaller businesses

Google yesterday extended its Adsense program to smaller businesses and is also testing a new "enhanced" search tool that provides web publishers with a flexible search tool to reflect the content of the site.

Adsense was previously offered exclusively to larger websites and portals that achieved a certain amount of web impressions, such as AOL and BellSouth. Now any web publisher can apply for the programme at www.google.com/adsense/.

Adsense delivers targeted text and image ads to websites, with Google sharing the revenue generated from ad clicks with the web publisher. The search tool is hosted by Google and requires no additional resources from the publisher.

These search results pages can also be customised with logos specified by the publisher and colour schemes that complement the website. Web publishers can also track the number of queries, clicks, click through rate, and earnings through a web-based account interface.

Google also announced it is trailing a 'Site-Flavoured Google Search'. The tool allows web publishers to select from a variety of categories to specify the interests that describe their website.

For instance, a computer site owner might select [computers > hardware] to describe their site. A user searching for the word "mouse" from that site will see results more relevant to the computer peripheral than the animal.

Source: Net Imperative

Traffix acquires SendTraffic.com

Traffix today announces that it has signed an agreement to purchase all of the assets of SendTraffic.com, a search engine marketing company.

Formed in 1999 by Messrs. Greg Byrnes and Craig Handleman, SendTraffic has been recognized as one of the top search engine marketing firms.

SendTraffic provides full service search engine marketing solutions to over 100 clients. During its five year operating history, SendTraffic has established strong working relationships with the major search engines and portals, including Google, MSN, Overture, FindWhat, Yahoo, AOL, Ask Jeeves and LookSmart.

SendTraffic maintains a "Certified Ambassador" status with Overture, and is a member of the Google Research Board.

Traffix reported that it expects SendTraffic to generate approximately $10 million in revenue and $1 million of EBITDA (1) in the next twelve months. In calendar 2003, SendTraffic generated revenue of approximately $5 million and an adjusted EBITDA of approximately $300,000.

Traffix expects to close the transaction on or about July 1, 2004. Traffix believes that the acquisition will be immediately accretive to Traffix's future earnings per share.

The Company also noted that after the closing of the SendTraffic transaction, it will still have cash and marketable securities on its balance sheet of over $33 million.

Under the terms of the acquisition agreement, dated June 9th, 2004, Traffix will purchase all of the assets (including net working capital of approximately $500,000) of SendTraffic at the closing for $5.43 million, comprised of $1.68 million in Traffix common stock, and $3.75 million in cash.

In addition, Traffix agreed to pay SendTraffic a contingent earnout of $2.5 million if SendTraffic generates EBITDA of $3.75 million in the first year following the closing, an additional $2.5 million if SendTraffic generates EBITDA of $4.75 million in the second year following the closing, and an additional $2.5 million if SendTraffic generates EBITDA of $5.75 million in the third year following the closing.

If SendTraffic generates certain lower agreed upon annual EBITDA benchmarks, Traffix will pay a portion of the contingent earnout payments. The contingent payments, if any are earned, may be paid 50% in cash and 50% in stock, with the share price determined on or about the time of their issuance.

In connection with the acquisition by Traffix, both of the founders of SendTraffic, Greg Byrnes and Craig Handleman, have agreed to enter into five-year employment contracts.

Commenting on the transaction, Mr. Jeffrey Schwartz, Chairman and CEO of Traffix stated, "Management has spent a lot of time trying to identify a meaningful acquisition that can add value to Traffix. We believe that SendTraffic fits that profile for a number of reasons.

First of all, the founders of SendTraffic, Greg Byrnes and Craig Handleman, built this company from their own hard labor with no third party capital. They are some of the most knowledgeable operators that we have met in the search engine marketing industry.

We interviewed a number of their competitors, clients and vendors and their reputation was stellar. Second, we believe there is a lot of potential synergy between the companies, since many of Traffix's current clients would likely use the SendTraffic services, and many of SendTraffic's clients may use Traffix's customer acquisition programs.

Interestingly, there is virtually no overlap in our respective client bases. Equally as important, SendTraffic should be able to enhance the growth of many of Traffix's current web properties through increased search engine traffic.

For example, SendTraffic and Traffix are currently collaborating on programs that will capitalize on some of the huge volumes of unsold search engine inventory. Finally, we believe that the purchase price and earnout formula represent fair and reasonable consideration for this business, and are not based on aggressive valuation multiples."

Commenting on the potential of the SendTraffic business, Mr. Schwartz stated, "We believe that SendTraffic has tremendous growth potential to add new clients from the thousands of businesses that have not begun to tap into the use of search engines for marketing.

Virtually any company can benefit from using search engine marketing if they are aligned with an industry expert such as SendTraffic. Furthermore, this type of growth is not capital intensive."

Mr. Greg Byrnes, co-founder and co-owner of SendTraffic, stated, "It was not an easy decision for Craig and me to sell the business. Frankly, we feel that by merging it with Traffix, we will be able to tap their tremendous resources and marketing expertise so that we can take this business to the next level.

We are very excited because we see so many opportunities to grow our business with Traffix. These guys have proven themselves with over 10 years of profitable operations in all forms of direct marketing media."

He added, "Collectively, we see the search engine industry as one of the most effective direct marketing media created to date. Overall, we are thrilled to be joining the Traffix family."

Mr. Joshua B. Gillon, Executive Vice President of Traffix added, "Traffix seeks to expand its business through sales of products and services sold directly to consumers, and through media properties that we use to generate sales and leads for our clients.

The acquisition of SendTraffic represents an important extension of our on-line media reach. Traffix will continue to seek other acquisition opportunities while it works to organically grow its current business."

Source: Personal Computer World

The BBC will make its archives available soon

The British Broadcasting Corporation's Creative Archive, one of the most ambitious free digital content projects to date, is set to launch this fall with thousands of three-minute clips of nature programming.

The effort could goad other organizations to share their professionally produced content with Web users.

The project, announced last year, will make thousands of audio and video clips available to the public for noncommercial viewing, sharing and editing. It will debut with natural-history programming, including clips that focus on plants, animals and birds.

"The Creative Archive is fuel for the creative nation," said Paula Le Dieu, co-director of the initiative. "It allows people to download these excerpts and be able to edit them and incorporate them into their own creative works."

Other organizations, including some small music publishers in the United States, have begun to offer their content to users under liberal licensing terms.

In contrast to record companies and Hollywood -- which are trying to lock down their content with help from legislators -- these organizations believe that liberal licensing terms will generate even more interest in their content.

In fact, in the BBC's case, access to its programming archive is part of its charter. In the United Kingdom, anyone who owns a television must pay a BBC-allocated fee, so the public owns its programming.

In the past, the BBC has not been efficient at making its archives accessible, Le Dieu said, but the Internet makes it much easier. In addition, digital distribution and editing tools now enable audiences to modify the content for their own creative endeavors.

The BBC archive would only be available to British citizens who pay the yearly TV license fee. Anyone who tries to visit the site through a foreign IP address won't be allowed to log on, Le Dieu said.

She said the BBC is working on ironing out various legal and contractual issues. The BBC plans to license its materials using a system similar to Creative Commons, an American organization that has developed a set of flexible copyright licenses for creators of digital content.

But clearing the rights is a significant challenge. Some clips contain elements like musical soundtracks, which may require getting permission from the copyright holders.

"Much of our programming is interspersed with other programming owned by other people," Le Dieu said. "We completely understand the audience's interest in getting the full programming. We're trying to balance that desire with the rights of the (content) ownership."

Those technical and legal challenges may render the archive incomplete, some fear.

"We want to make sure that the archive is more than just shagging marmots," said David Tannenbaum, coordinator for the Union for the Public Domain. "There's been no public discussion of how they are going to get beyond these nature clips."

Tannenbaum said the group hopes to build support to change the BBC's charter in 2006, when it comes up for review, so that the BBC will commit more fully to open access. Also, the group wants the BBC to clear rights with other copyright holders in its future contracts, so that the BBC can freely distribute other producers' works.

But observers expect commercial broadcasters to oppose the archive and the expansion of liberal licensing efforts, arguing that they cannot compete with free programming.

"We hope that by getting this into the charter, that people within the BBC will be able to stand up to the objections that get raised as time goes by," said Cory Doctorow, European affairs coordinator for the Electronic Frontier Foundation.

"They will have the ammunition they need to say, 'This is exactly what the BBC is there for: to really move public broadcasting into the next century and define what public broadcasting looks like in an Internet world.'"

Lawrence Lessig, Stanford law professor and founder of Creative Commons, said the BBC's plan would help the world understand that there is more at stake in the copyright war than "piracy."

"If the archive succeeds ... then that will drive demand for computers, broadband and software to enable that creativity," he said. "Businesses -- beyond the content industry -- will recognize just what's at stake."

The BBC hopes others will follow its lead. "We hope that we can provide a model so other rights holders can do something similar," Le Dieu said.

Source: Wired News

Akamai disruption affected Google, Yahoo and Microsoft

A DNS service outage at Akamai Technologies prevented access to some of the Internet's major Web sites Tuesday, including Google, Yahoo and Microsoft, according to The SANS Institute's Internet Storm Center.

The DNS (domain name system) servers that content hosting company Akamai uses to host DNS services for some customers stopped responding at around 8:30 a.m. Eastern Time in the U.S., leaving Web surfers who were trying to reach those sites high and dry, said Johannes Ullrich, chief technology officer at the Internet Storm Center.

Andy Ellis, Akamai's chief security architect, declined to comment on Tuesday, but did not deny that the Cambridge, Massachusetts, company was experiencing problems.

An Akamai spokesman did not respond to requests for comment. Akamai offers an "Enhanced DNS" service, in which customers use Akamai's network of DNS servers to resolve Internet requests for their domain, such as Google.com. The distributed, worldwide network of servers is marketed by Akamai as a more stable and robust solution than internally managed DNS servers, which are susceptible to failure or attack.

However, users began reporting problems Tuesday reaching popular sites, like Google.com and Yahoo.com, that use the service. The Internet Storm Center received reports of troubles from across the world, including Asia and South America, Ullrich said.

An investigation into the problem revealed that Akamai's DNS servers were not responding to requests. The problem appeared to affect the company's worldwide network of DNS servers, suggesting that the problem may have been with caused by a problem within Akamai rather than an external attack on its DNS servers, Ullrich said.

"It could be anything -- somebody tripping on an power cord. I think an attack is unlikely, unless somebody was able to hit a central control node," he said.

While some Internet users were prevented from reaching the affected sites during the outage, others were unaffected, due to the distributed nature of the DNS infrastructure.

DNS, which translates reader-friendly names like "Yahoo.com" into numeric Internet Protocol addresses used on the Internet, is a tree-like structure of distributed servers, each with its own frequently-updated list of server and domain addresses.

Problems in one part of the DNS system often do not affect other parts of the infrastructure for hours, or more, Ullrich said.

The hiccup in Akamai's service is the second in less than a month. In May, a software glitch slowed Akamai servers used to host customer Web pages and other information, making it difficult to reach some of its customers' Web sites for around 90 minutes, Akamai acknowledged.

Akamai blamed that service interruption on a bug in content management software that Akamai customers use to update content on Akamai servers, said Jeff Young, an Akamai spokesman.

Yahoo.com, Google.com and Microsoft.com were all reachable again within two hours of the reported interruption.

Source: IDG News Services

Yahoo Takes On Google with E-Mail Storage Offering

Yahoo (Nasdaq: YHOO - news) has rolled out a new e-mail product designed to compete with Google's forthcoming Gmail offering and dark horse Lycos' similar service, which made its surprising debut last month.

New features include 100-megabytes of free storage -- 25 times more than Yahoo's prior offering. Premium customers, including subscribers to SBC Yahoo! Dial and DSL, will have virtually unlimited storage at 2 gigabytes, or 200 times the amount offered by most other Internet service providers, according to Yahoo.

The company also has redesigned its e-mail page: It now includes new search capabilities, and graphical ads from Yahoo! Mail Plus and SBC Yahoo! Mail have been removed. And Yahoo is opening up over 50 million Yahoo IDs to give consumers more address options for their e-mail accounts.

Market Moves

Yahoo's plans initially were reported at a corporate meeting last month. Shortly thereafter, Lycos jumped the gun with a similar e-mail offering, albeit at different price points. The concept of free, near-unlimited storage first was introduced, though, by Google, as it announced its Gmail offering with great fanfare.

"The Internet-portal and search-engine market, in general, is becoming increasingly competitive just in the last six months," Yankee Group analyst Patrick Mahoney told NewsFactor. "All of them are looking for any way to differentiate themselves to garner more customers or keep current customers satisfied."

Indeed, within the space of a few months, free e-mail with unlimited storage has become the de facto minimum standard for Internet content providers, such as Yahoo, AOL (NYSE: AOL - news) and Google -- much to their chagrin, no doubt. E-mail accounts, at one time, were considered a revenue source for these providers, Mahoney noted. The premium accounts still will be, of course, but given the storage available in the free accounts now, the paying accounts will represent a much smaller portion of revenue.

Pay IM

Even this model may change once again. Online consumer and business products, such as e-mail or instant messaging, are in a constant state of flux as Yahoo, Google, AOL and others seek ways to make Internet services pay. For example, AOL is hoping to turn its instant-messaging product into a paying concern by attaching value-added services and marketing the enhanced product to business.

AOL recently launched AIM Business Services, a voice and Web-conferencing product it has developed through partnerships with technology providers Lightbridge and WebEx, respectively.

AOL can use AIM as a launch pad for conferencing, drawing more corporate customers, IDC research manager Robert Mahowald told NewsFactor, noting that Yahoo has Business Messenger, a similar product that offers the same WebEx conferencing technology.

The difference between the two offerings is that any AOL AIM customer can use the business services, while Yahoo requires users to sign up separately for its business messaging service and charges a subscription fee.

Erika Morphy, www.newsfactor.com

Yahoo cancels corporate instant messaging

The cancellation of Yahoo Messenger Enterprise Edition marks the end of the Web portal's now-defunct enterprise software division.

The unit was created in 2000 to sell customized Web portals and video conferencing services for internal use in corporations. But in October 2003, Yahoo scrapped the division and melded its businesses with their consumer counterparts.

Yahoo confirmed on Thursday that it is no longer selling a version of its popular instant-messaging service for corporations, ending the Web portal's attempt to sell IM as a software package.

In an informal interview earlier this week, Yahoo's Chief Information Officer Lars Rabbe said the enterprise instant messenger was shelved, because Yahoo is largely a consumer company and not structured to take on the kind of support tasks and other responsibilities that come with selling corporate software.

The move will consolidate Yahoo's consumer and enterprise products into one product package.

"We have reorganized our instant-messaging business to optimize our ability to leverage the Yahoo network, whether our customers are at work or at home," Lisa Pollock Mann, senior director of Yahoo Messenger, said in a statement.

A Yahoo representative declined to comment Thursday on when the company had stopped selling the service.

To the Big Three Web portals--Yahoo, Microsoft's MSN and America Online--selling IM to companies has sounded like a good idea. The companies all offer popular, free IM clients that millions of Internet users have downloaded. IM technology lets people exchange messages in real time, and it has evolved features that let users play games, make phone calls and hold video conferences.

Instant messaging has made its way into companies as well. Some 85 percent of all enterprises in North America use a form of IM in their networks, according to a survey by research firm The Radicati Group. This penetration was mainly spurred by employees downloading Yahoo, AOL or MSN software to keep in touch with personal and professional contacts.

However, IM flourished in businesses without the oversight of corporate information technology departments, leaving many system administrators concerned about IM's safety against viruses. Some industries regulated by the federal government, such as the financial services and health care industries, are concerned that the use of IM in their offices might violate compliance or privacy laws.

The Big Three saw in this an opportunity to sell adapted versions of their free service to companies. The revamped software included features such as conversation logging, authentication and identity management. The companies also partnered with third parties such as IMLogic and Facetime Communications to add these applications to their IM products.

But consumer Web companies often have a hard time becoming enterprise software vendors, some industry watchers have noted.

"The market has shown that you cannot bring continuity from the consumer market to the enterprise market," said David Gurle, an executive vice president of Reuters Messaging. "You need to think about the enterprise market very differently than the consumer market, which doesn't pay you directly."

In addition, experienced vendors such as IBM and Sun Microsystems have begun offering their own IM products through their established sales channels.

Like Yahoo, AOL has retrenched its enterprise IM division. It has opted instead to sell add-ons such as video conferencing for a fee. Microsoft has focused less on MSN Messenger and more on its Live Communications Server--which combines IM, Net phone calling and video conferencing--as its enterprise communications product.

Source: C-Net News

Adsense program extended to smaller businesses

Google yesterday extended its Adsense program to smaller businesses and is also testing a new "enhanced" search tool that provides web publishers with a flexible search tool to reflect the content of the site.

Adsense was previously offered exclusively to larger websites and portals that achieved a certain amount of web impressions, such as AOL and BellSouth. Now any web publisher can apply for the programme at www.google.com/adsense/.

Adsense delivers targeted text and image ads to websites, with Google sharing the revenue generated from ad clicks with the web publisher. The search tool is hosted by Google and requires no additional resources from the publisher.

These search results pages can also be customised with logos specified by the publisher and colour schemes that complement the website. Web publishers can also track the number of queries, clicks, click through rate, and earnings through a web-based account interface.

Google also announced it is trailing a 'Site-Flavoured Google Search'. The tool allows web publishers to select from a variety of categories to specify the interests that describe their website.

For instance, a computer site owner might select [computers > hardware] to describe their site. A user searching for the word "mouse" from that site will see results more relevant to the computer peripheral than the animal.

Source: Net Imperative

Yahoo to hire PR agency for promotion

Revolver Communications, TheFishCanSing, Cow PR and Naked Communications are the PR agencies understood to be about to lock a contract with Yahoo.

PRWeek understands that Yahoo! is prepared to spend up to £2m on activity coordinated by the selected agency. The account will involve non-traditional PR, such as guerrilla marketing and event-based promotional work, and an appointment is expected within weeks.

It is understood that the focus of the promotional activity will be a single major event that is set to take place in England later this year.

The communications blitz will aid Yahoo!'s bid to compete with market-leader Google in the internet search market. Yahoo! wants to become the number-one global provider of search.

The internet company currently retains Cow to handle its consumer PR and Revolver to promote its Yahoo! Personals service.

A Yahoo! spokesman confirmed that 'meetings' were ongoing with agencies. He declined to comment on the fees of the planned PR contract.

The spokesman stressed that the company's pre-existing contracts with PR and marketing agencies -- such as Cohn & Wolfe, which handles corporate PR and press office work for Yahoo! Personals -- were not being reviewed.

Yahoo! is investing heavily to strengthen its search engine capabilities, having bought paid-for search companies Inktomi and Overture and French online shopping comparison service Kelkoo within the past 12 months.

It is understood that Yahoo! UK & Ireland marketing director Yonca Brunini is planning imminent further discussions with the four agencies battling for the new account and that head of PR Georga Douglas and PR manager Jon Wayth are also involved in the review.

Source: Digital Bulletin

Yahoo Ups E-Mail Storage Allowance

Yahoo Inc. (Nasdaq:YHOO - news) on Tuesday made good on its promise of a month ago and boosted the storage allowance for users of its free and for-fee E-mail services.

In a move to pre-empt Google's Gmail, the search site's announced-but-not-yet-final E-mail service that started the arms race in the Web-based mail space by offering 1 Gbyte of storage, Yahoo handed out 100 Mbytes of storage space to all users of its free E-mail and boosted storage for premium customers to 2 Gbytes.

Previously, users of the for-free version of Yahoo Mail were limited to just 4 Mbytes. With the capacity expansion, Yahoo is also allo