Overture Buys AltaVista and FAST
At the end of February Overture, the largest "pay-per-performance" search engine, announced the pending acquisitions of both AltaVista and FAST. Overture paid $80 million in stock and $60 million in cash for AltaVista. A week later they announced a deal to pay $70 million in cash for FAST, which operates
www.alltheweb.com, along with up to $30 million in performance incentives over 3 years.
Wall Street's reaction to the move was not favorable. Overture's stock price lost 33 percent of its value in the days following the announcements. Still, Overture insists that the acquisitions were a good move for the company and its advertisers. Industry critics contend that in many ways the two purchases may be redundant with too many overlapping components.
What does this mean to the average Web marketer? Overture says it plans to use
www.alltheweb.com, which receives 2.5 million queries per day, as a test-bed site for new technologies. This is not unlike what FAST has done. FAST also serves its results on other sites including Lycos.
Overture announced plans to combine its existing service with the technologies of AltaVista and FAST to create a comprehensive product offering of:
Pay-for-performance. This is where advertisers bid for top rankings and is what Overture currently offers. Pay-Per-Performance is also known as pay-per-click (PPC).
Paid Inclusion. Web marketers can choose to pay a fee in exchange for a guarantee to be included in a crawler-based database of search results. Inktomi is another engine that offers this. However, a top ranking is NOT guaranteed. Instead, the main benefit is prompt inclusion in the index. Generally with this model you can submit for free and wait three to four weeks for inclusion, or you can pay for inclusion and be indexed in a week or less. AltaVista has offered paid inclusion technology for some time, along with free submission.
Algorithmic Searches. A search engine crawls the Web indexing pages for free and ranking them based on its own algorithm. The goal is to rank pages based on the value of their content, the design of their page, and other factors such as link popularity. Both AltaVista and FAST will provide Overture with technologies to do this. Overture plans to ultimately leverage technologies from both services.
It's a sure bet that Overture.com will be dropping their Inktomi results in favor of FAST, AltaVista, or a combination of the listings later this year. While this will be a blow to Inktomi, it did receive a boost when Yahoo recently acquired it. That acquisition is expected to lead to the dropping of Google from Yahoo.com in favor of Inktomi and Yahoo based results.
Along with AllTheWeb.com, Overture announced its intent to continue to operate AltaVista.com, which receives approximately 18 million queries per day. It also plans to continue AltaVista's paid inclusion service and to combine it with its other product offerings. Most analysts believe this is a move to compete against Google, which has been growing in popularity in recent years.
Linear Mode
