Home  › Marketing › Strategies

Overseas Search Execs Say Microsoft Should Look Beyond Yahoo

  |  February 26, 2008   |  Comments

As Microsoft grows more hostile in its bid for Yahoo, some search marketers think the software firm should pursue overseas targets instead.

As Microsoft grows more hostile in its Yahoo takeover efforts, some search marketers wonder whether the software firm ought to be pursuing overseas targets instead.

"Microsoft could be doing far better things with $40 billion dollars," said Andy Atkins-Kruger, managing director of international search marketing firm Web-Certain, speaking with ClickZ News last week. Microsoft made a $44.6 billion bid for Yahoo earlier this month, which Yahoo's board rejected. Since then, Microsoft has threatened a Yahoo Board coup.

"Search is global," he continued. "Microsoft should be looking to expand its presence outside of the U.S., instead of paying over the odds for a company that will have relatively little effect on its global presence."

Attendees at the Search Engine Strategies event in London last week expressed excitement at the prospect of a more competitive search landscape as a result of the proposed acquisition. However, they are concerned a Yahoo takeover may be the wrong way for Microsoft to go about spurring competition and taming Google's dominance.

In December 2007, Google's U.S. search audience share stood at 58 percent, ComScore reports. Yahoo ranked second with 23 percent, followed by Microsoft at just under 10 percent. Although a Yahoo purchase would strengthen Microsoft's search offering in the U.S., marketers suggest it is unlikely to cause any major waves outside it.

"I don't think Microsoft would see [$44.6 billion] worth of return on this investment," said Atkins-Kruger.

Other search professionals were skeptical as to whether a Microsoft/Yahoo combo would be capable of eating into Google's U.S. dominance, and also voiced concerns that a failed challenge in the U.S. market could result in a complete Google whitewash.

According to ComScore, Internet users outside the U.S. now account for over 80 percent of the world's online population. If Microsoft is truly hoping to challenge Google in search, therefore, perhaps it would do well to look at firms based in international markets in which Google does not already have such a strong foothold.

Atkins-Kruger cited potentially more lucrative targets, such as Yandex and Baidu, the dominant search players in the Eastern European and Chinese markets, respectively. ComScore reports that between January 2006 and January 2007, Internet penetration in China and The Russian Federation rose by at least 20 percent year-over-year compared with a 10 percent increase in the U.S.

Google acquired a minority stake in Baidu in 2004, and later unloaded the stock in '06.

Andreas Pouros, managing director at SEM firm Greenlight, acknowledged that Microsoft may find more solid search investments outside of the U.S., but suggested the proposed purchase is perhaps more tactical than a simple attempt to gain audience share.

"It would make more sense for Microsoft to pursue less Google-dominant markets," he said. "But at the same time, it can't just allow Google to run away with things in the U.S."

"I think this bid is largely about hindering Google," he continued. "Microsoft may just be looking for any way it can stay in the game."

Microsoft still appears to be dead set on winning Yahoo. The software giant hired a proxy solicitation specialist recently, following its promise to "pursue all necessary steps" to secure a deal. If Microsoft does plan to launch a proxy battle, it now has until March 13 to nominate a new board of directors ahead of Yahoo's annual meeting in June.

Tags:

ClickZ Live San Francisco This Year's Premier Digital Marketing Event is #CZLSF
ClickZ Live San Francisco (Aug 11-14) brings together the industry's leading practitioners and marketing strategists to deliver 4 days of educational sessions and training workshops. From Data-Driven Marketing to Social, Mobile, Display, Search and Email, this year's comprehensive agenda will help you maximize your marketing efforts and ROI. Register today!

ABOUT THE AUTHOR

Jack Marshall

Jack Marshall was a staff writer and stats editor for ClickZ News from 2007 until August 2011. 

COMMENTSCommenting policy

comments powered by Disqus

Get the ClickZ Marketing newsletter delivered to you. Subscribe today!

COMMENTS

UPCOMING EVENTS

Featured White Papers

BigDoor: The Marketers Guide to Customer Loyalty

The Marketer's Guide to Customer Loyalty
Customer loyalty is imperative to success, but fostering and maintaining loyalty takes a lot of work. This guide is here to help marketers build, execute, and maintain a successful loyalty initiative.

Marin Software: The Multiplier Effect of Integrating Search & Social Advertising

The Multiplier Effect of Integrating Search & Social Advertising
Latest research reveals 68% higher revenue per conversion for marketers who integrate their search & social advertising. In addition to the research results, this whitepaper also outlines 5 strategies and 15 tactics you can use to better integrate your search and social campaigns.

WEBINARS

Jobs

    • Business Intelligence and Reporting Analyst
      Business Intelligence and Reporting Analyst (Stansberry and Associates) - BaltimoreStansberry and Associates is seeking a driven individual to fill...
    • Internet Marketing Campaign Manager
      Internet Marketing Campaign Manager (Straight North, LLC) - Fort MillWe are looking for a talented Internet Marketing Campaign Manager to join the...
    • Online Marketing Coordinator
      Online Marketing Coordinator (NewMarket Health) - BaltimoreWant to learn marketing from the best minds in the business? NewMarket Health, a subsidiary...