Yahoo / Bing Search Alliance Update

Below is a quick summary of the most recent update from Yahoo regarding the Bing (Microsoft Search) / Yahoo advertising alliance, an attempt by both companies to stem the tide of Google’s search dominance.   Yahoo’s history of bad search decisions makes me a bit worried that they may try to compromise Bing’s (pretty good) search quality in favor of paid listings, further eroding the credibility gap between Google and Yahoo/Bing search.

Ironically Google search is probably more vulnerable than ever to the advent of a new, great search engine  thanks to Google’s current tendency to   1.  Elevate old and well SEOd (Search Optimized) websites above newer, better ones   2. Avoid proper policing big players like Ebay / Amazon who often appear high in paid and sometimes even organic rankings despite no/thin content about the query.  3. Maintain unreasonably high per click charges on many terms, effectively favoring the big money / big box  advertisers over small businesses.   4.  Not use enough social media feedback to help rank sites (they use some and I’d guess are slowly integrating this, but nobody has made the breakthrough that will come from clever “crowdsourcing” about websites.        5. THROUGH 10.      LACK OF TRANSPARENCY!       Google remains very opaque when it comes to website rankings, and Yahoo in their infinite lack of cleverness 3 years back missed a golden opportunity to come to the rescue of advertisers, webmasters, and most importantly users by creating a more level field with a lot more information about how rankings work combined with public identification of site owners, webmasters, and spammers/ abusers.    Creating this type of transparency would solve many of the problems that currently plague the search game, most importantly the problems that come from webmasters trying to please Google rather than create new, innovative sites.    Best single example is the fiasco of Google’s insistence on “Nofollow” links, which have seriously distorted the entire search landscape to favor cleverly optimized / costly sites over new mom and pop operations.

You see this often  in the travel space where large, thin sites outrank rich, local sites that are newer and don’t have the link base of the older sites.     With Google as pretty much the only search in town, new links will flow mostly as a function of  the rank of the website, so we have a circular system where the “rich get richer”.     [for the record this aspect of the algorith benefits me in the case of some of my very old websites, so this is not a “sour grapes” rant as much as a critique of the approach].

However I’m not holding my breath on Bing Yahoo taking up much of Google’s market share.    As we’ve noted before Google remains an excellent tool, and it took hold of people’s search consciousness at the time they were developing their online habits, so even a superior search would have trouble hurting Google’s dominance, and to Google’s credit I think they continue to approach things more from a quality side than a revenue one.

From Yahoo:

Assuming our testing continues to yield high quality results, we anticipate that our organic search results will be powered by Bing beginning in the August/September [2010] timeframe.

This appears to be a good sign that they will not compromise organic quality in favor of elevating paid listings, a move that would probably lead to significant loss of their current (low) market share.

From Yahoo:

Compare your organic search rankings on Yahoo! Search and Bing for the keywords that drive your business, to help determine any potential impact to your traffic and sales.


Decide if you’d like to modify your paid search campaigns to compensate for any changes in organic referrals that you anticipate
Review the Bing webmaster tools and optimize your website for the Bing crawler, as Bing results will be displayed for approximately 30%* of overall search query market share after this change

This on the other hand seems a little more alarming, suggesting that people may want to pony up to maintain their ranks after the Bing transition.      Over the coming weeks there will be a lot of Bing quality testing by other SEO centric websites and we’ll try to summarize that in a later post.      We’ll also be blogging the upcoming SES San Francisco (Formerly SES San Jose) search conference – the most influential search gathering  in the world, and have more on the Bing Yahoo changes.

———–  Full Text of Yahoo’s Note ———-

Dear Advertiser,

As we continue to work closely with Microsoft to implement our search alliance, we wanted to provide you with an update on our progress, as well as call out some important, upcoming milestones to help ensure you are prepared for the changes to come.

Transition with Quality
Our goal remains providing a quality transition experience for advertisers in the U.S. and Canada in 2010, while protecting the holiday season. We’ve continued to make good progress against this goal, and we regularly evaluate our progress. However, please remember that, as we continue to go through our series of checkpoints, if we conclude that it would improve the overall experience, we may choose to defer the transition to 2011.

Organic Search Transition
To date, we’ve focused most of our communications to you on the paid search transition to adCenter. However, another key aspect of the Yahoo! and Microsoft Search Alliance is the transition of Yahoo! organic search results (those found on the main body of the page). Assuming our testing continues to yield high quality results, we anticipate that our organic search results will be powered by Bing beginning in the August/September timeframe.

If organic search results are an important source of referrals to your website, you’ll want to make sure that you’re prepared for this change:

Compare your organic search rankings on Yahoo! Search and Bing for the keywords that drive your business, to help determine any potential impact to your traffic and sales
Decide if you’d like to modify your paid search campaigns to compensate for any changes in organic referrals that you anticipate
Review the Bing webmaster tools and optimize your website for the Bing crawler, as Bing results will be displayed for approximately 30%* of overall search query market share after this change

For more specifics on the organic search transition, please refer to the Self-service Advertiser FAQs on the Yahoo! Transition Center.

Organic and Paid Search Testing
To help us deliver on our goal of transition with quality, we are conducting the necessary tests to ensure that all of the many complex, logistical pieces are in place. While there’s nothing you need to do to prepare for testing, please keep in mind the following:

Though much of our testing is already happening offline, this month we’ll also test the delivery of organic and paid search results provided by Microsoft on live Yahoo! traffic
Testing volumes will fluctuate during this period, with paid search volume in particular kept low enough to help minimize any potential impact to your account

Editorial Guidelines
Yahoo! and Microsoft have created joint editorial guidelines that will begin taking effect for both Yahoo! and Microsoft paid search advertisers in early August. We encourage you to review these now, so that you understand any potential impact to your ads or keywords. Notable changes include new guidelines for gambling and contests, and disallowed content. For a detailed overview of the editorial policy changes that will soon take effect, please read the New Editorial Guidelines article.

We are committed to making this transition as seamless and beneficial for you as possible. We appreciate your business, and look forward to bringing you the benefits of the Yahoo! and Microsoft Search Alliance.

Sincerely,
Your Partners at Yahoo!

Disclaimer:   Joe has Yahoo Stock.   Not that he’s happy about that fact.  Nope, not happy at all.

Crowdsourcing Microsoft Office 2010

Wired has an interesting  article noting how Microsoft “crowdsourced” some of the development of Office 2010.     Although I’m a user of Google Documents and not a fan of the MS Office Suites, feeling they are too big, clunky and overengineered for 99% of the tasks most people need, clearly I’m in the minority because, as Wired notes in the article, only 4% of online users “regularly use” Google Docs where 67% say they use MS Office products.     I think familiarity is a key issue here, and it will take more than a decade for the MS dominance to give way to the online suite tools that probably need another few generations of improvements and visibility to come into widespread use.

Of the 2 million Send a Smile comments, 81,000 included the senders’ e-mail addresses so the engineers working to improve Office could follow up with them.

To their credit Microsoft created a way for beta testers to give feedback and follow up, and hopefully this innovation will result in a product that is superior.    In my view Crowdsourcing is arguably the most powerful aspect of social media, but the science of using it effectively is still in its infancy and we’ll need very clever routines to make sense of human input – much of which is counterproductive, nonsensical, or simply worthless.     For the Office Suite project Microsoft developed relevancy algorithms to process the millions of comments, and it would be interesting to hear more about the approaches that went into the evolution of that  process.
Read More http://www.wired.com/gadgetlab/2010/06/microsoft-office-2010/#ixzz0sMYfsPaw

(Thanks to Ken Kaplan at Intel for noting this WIRED story)

New CEO Bartz on Yahoo “Look for this company’s brand to kick ass again.”

Only in Silicon Valley could a CEO get away talking about their brand “kicking ass”, but Yahoo’s in Silicon Valley and Carol Bartz is their new tough talking CEO, who today wrote in Yahoo’s official blog “Yahoo Anecdotal” that Yahoo is “Getting our house in order“.  Among other thing Bartz says she is :

….rolling out a new management structure that I believe will make Yahoo! a lot faster on its feet. For us working at Yahoo!, it means everything gets simpler. We’ll be able to make speedier decisions, the notorious silos are gone, and we have a renewed focus on the customer. For you using Yahoo! every day, it will better enable us to deliver products that make you say, “Wow.”

When former Yahoo CEO and co-founder Jerry Yang (Yahoo was co-founded with David Filo) left the company a few months ago Carol Bartz stepped in aggressively, presumably tasked by Yahoo’s board to either turn the company around or prepare for a sale of Yahoo Search, or perhaps even the entire company, to Microsoft.

Given that turning Yahoo around is considered by most to be extremely challenging and long term,  I think we should assume Bartz is working the Microsoft sales angle even though much of the tough talk is more along today’s lines of restoring the second most recognizable internet brand to at least a shadow of Yahoo’s former glory.     Note though that even assuming a sale to MIcrosoft is in the goal, it’s probably in Yahoo shareholder’s best interests for Bartz to talk and work towards shoring up the brand, hoping to encourage Microsoft to offer more of a premium over the current share price than they might if they knew a deal was inevitable.

We can get some insight into what Carl Icahn – one of Yahoo’s largest shareholders and board members –  is looking for in this deal thanks to this excellent report on his stock holdings and pricing.   With an average share price is in the neighborhood of $20-25,  I would argue that Icahn wants Microsoft to come in somewhere north of that for him to agree to a sale.     Microsoft offered $31 officially last year before the stock meltdown and most fell they would have paid about $34, but clearly that deal is long off the table. However given Microsoft’s lackluster online performance and the chance for a crack at Google’s dominance, look for Microsoft to make an offer soon.  Look for Yahoo to probably take it.

DISCLOSURE:   Technology Reporter Joe Hunkins is long on YHOO

CES Attendance (unofficial) 114,000

Although I have not heard the number yet from CES which I think is holding a Press Conference right now, a major vendor gave me this number which is consistent with the many reports suggesting a significant scale back by many of the companies here at CES.    Although presumably the conference budgeting was already done long before the global economic meltdown it seems likely many have tried to scale back by sending fewer staff, sponsoring fewer parties etc.    That said I have not noticed a difference myself in terms of people or coverage – the press seems out in full force here at CES.

Although Alibaba is showing here I’m getting the distinct idea that web companies are very much out of CES – I’d guess for several years as the online economy shakes out, killing the weak while the strong struggle to survive amidst dramatically declining advertising revenues.

One conspicuously absent company is Yahoo which last year had a major display tent in the LVCC parking area and where Jerry Yang delivered a (very lackluster) introduction to what Yahoo was up to in 2009.    Not much was my conclusion after that talk.  In fact in my interview with Yahoo Co-Founder David Filo he almost insisted they did not want to be purchased my Microsoft and he certainly was being truthful (though probably not very wise), it was soon after CES that Microsoft offered Yahoo 31+ per share in a buyout offer many felt was a no-brainer at the time.    It now appears Microsoft will scoop up Yahoo Search and perhaps the whole show anyway, probably for far less than their original offers of 2008.

Disclosure:  Long on Yahoo