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Google Marches On!
Author: By: Roger Bauer
October 19, 2006-Wow!!! First Google reports another blowout quarter. Earlier
the same day, Nielsen publishes search results for September 2006, and Google
put the hammer to the competition there also. They garnered 50% search share
which equates to 24% growth year over year (YOY). Talk about impressive
numbers-the Google train obviously isn't slowing!
How does this impact
the major search game? Does this sound the warning siren to Microsoft that maybe
they ought to reconsider buying out Yahoo? It makes perfect sense given the fact
that Microsoft's search results continue to fall (-12% YOY to a 9.23% share),
and Yahoo isn't keeping Google within an eyeshot either although they still
maintain a nice share of the search market (23.4%; up 12% YOY). The two of them
combined would give Google a little competition, and we, the consumer, would
benefit from greater services and advancements in software along with online
options as the companies battle it out in the marketplace. If not, Google is
going to run off and hide.
Perhaps Yahoo (with a lot of cash to spare)
will buy some smaller niche companies to make themselves even more attractive to
Microsoft, but I don't believe Microsoft will sit by idly while Yahoo postulates
what to do next. It's Microsoft's move to make, and the time to act is now; not
a year from now when their collective search share is even lower. Google is a
formidable threat to Microsoft, and they aren't going to take a breather just
because they've hung up yet another blow out quarter financially and in search.
Yahoo has shown they can't keep pace on their own so they're going to need some
help if they have any intention of ever catching Google. Google smells blood,
and that signals the time to push harder; not back away. YouTube is likely just
the beginning of an intriguing acquisition spree for the gang in Mountain View.
Microsoft would be wise to snatch up Yahoo right now after Yahoo posted
a rather blah quarter earlier in the week which will shrink their market
capitalization a little where Mr. Softy could acquire Yahoo at a "discount."
They didn't like the idea of buying Yahoo at $29/share a couple months ago, but
they should probably like it at $25.
Yahoo isn't "dead." It's not like
they're stinking up the joint (they are still growing albeit much slower), and
they do understand the search game which Microsoft hasn't quite yet figured out.
It seems to make a logical marriage at this stage of the game.
Bottom
line: this is shaping up rather nicely as a good ole fashion duel that may take
some time to determine the ultimate winner, but we'll be anxiously monitoring
the three "big dogs" as they ponder their next move in this high stakes search
engine chess match. Stay tuned, the best is yet to come.
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