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Overture buying Alta Vista
$140 million is the price

 9:41 pm on Feb 18, 2003 (gmt 0)

Read all about it [cbs.marketwatch.com]

Overture is to buy Alta Vista for $140 million.

Guess this is one of the "enhancements" we were told would happen as part of the sweetener for 10 cent minimum bids.



 7:08 am on Feb 19, 2003 (gmt 0)

I agree with Learning_curve,

I think Overture knows something we do not.

They probably will loose Yahoo and/or MSN soonest.

Why buy a competitor to your existing clients?


 7:28 am on Feb 19, 2003 (gmt 0)


So who can remember how to optimize for AV?

I haven`t concentrated on AV for ages, but I guess I have to brush up my knowledge ASAP. :)


 7:46 am on Feb 19, 2003 (gmt 0)

What a shock, look what what happens when you go to bed.

It maybe all very well Overture buying AV, but what are they going to do to pull the punters back?


 9:00 am on Feb 19, 2003 (gmt 0)

I knew this was coming. I can finally speak. Here's the answer to the most asked question

Is INK now going to show on AV?
Initially no. They are planning an Overture / AV Combo. However, there are plans on merging INK in later. After an analysis of the search results (e.g. Relavancy) They will deside whether to drop AV. All should be known within 3 months.

My personal opinion
It will end up Overture and Ink with the already paid for AV listings going in INK.



 10:42 am on Feb 19, 2003 (gmt 0)

www.online-marketing-kongress.de/referenten/all.htm or keep the babelfish in its bowl:

Mr Holl, the Marketing Director of Overture Germany, used to be Altavistaīs Marketing Director Germany,Austria,Switzerland before.

any other known "team-crossovers"?
Are the "good old boys" getting themselves their "good old AV" back? :-)



 11:28 am on Feb 19, 2003 (gmt 0)

IMHO...Teoma won't be bought, as Ask Jeeves are spending so much time & money developing and integrating it.

Why would MSN not buy LookSmart...which gives them index search through WiseNut (although out of date), PFP through LookListings and develop their own PFI product, and continue to use Overture - or more likely develop their own PPC product, which is increasingly looking more likely so that they get back the control which so many portals have lost to Overture?


 11:36 am on Feb 19, 2003 (gmt 0)

Thereīs a point here that should really concern us - a PPC company buying a search engine? It isnīt hard to imagine what Overture is interested in (more advertising) and what not (independent relevant search results).

Itīs not that much a problem NOW, because Altavista is not really an important search engine. Just theory, but what horror would it be if they bought something a little biGGer (which might, in theory again, become possible after Googleīs IPO).

But maybe, Overture is smarter than most of us expect and will be improving AVīs algo - understanding the value of independent search results. Of course, below the sponsored listings.. :)


 11:56 am on Feb 19, 2003 (gmt 0)

"Suggests Overture knows Yahoo is developing their own PPC engine."

That was clear writing on the wall with the Ink purchase. Lots of people seem to have missed the point of that completely.


 12:33 pm on Feb 19, 2003 (gmt 0)

So what's to become of AV's non-web searches like images and news? I hope they stay around. PPC image search perhaps :)


 12:53 pm on Feb 19, 2003 (gmt 0)

If this continues we could have a situation that by year end we have :


with everyone else being gobbled up as an acquisition target. At least the money involved is more sensible, and poorly run companies will always be prone to takeover, and AV lost the plot from being the dominant force in the market which is inexcusable.

For that reason alone I think Google will have to go IPO to maintain their position, with other "super-powers" grabbing market share eventually they will turn attention to how to take Google market share.

How long is the AOL/Google contract?


 12:56 pm on Feb 19, 2003 (gmt 0)

I'll take that one step further:



 2:02 pm on Feb 19, 2003 (gmt 0)

>>Initially no. They are planning an Overture / AV Combo. However, there are plans on merging INK in later.

huh? That doesn't make sense. Why would INK merge in with Overture and AV when Yahoo buying up Ink? Please explain more.


 2:08 pm on Feb 19, 2003 (gmt 0)

There was quite a stir here when LookSmart bought Wisenut and just look how they have revolutionized the search industry! :)

I'm with NFFC:

Company not very good at search buys another company not very good at search ....

Big Whoop. I don't plan to do any hand wringing just yet about optimizing for OverLaVista!

Considering all the changes amongst the major players and "has beens" which have taken place over the past year and a half, none of it has had a tremendous effect on Google's ever increasing market share. Yawn.

I'm waiting for some really big headline such as "Google or MSN buys Fast" before I get all worked up. :)

GrendelKhan TSU

 2:16 pm on Feb 19, 2003 (gmt 0)

ok....had to chime in. First, I could not disagree more with the idea that this is a sign of desperation by OVER. That could not be further from the truth. Listen to their finance report (free downloads) and you would know that they are fffaaarrrrr from desparate and revenue sacrifices were largely supporting foreign expansion (and yes, pressure from portals for even larger returns). Clicks are a scarce resource and as such, once you've max out....you optimize then diversify.

I am deeply active in the PPC world (if not in this forum) and can confidently say that I would do the same if I was a rich and dominating PPC. Why? well for exact reasons Overture says and emphasizes REPEATEDLY: AV is a great testing platform with loads and loads of value-added services and products and patents (hiding the truth in plain sight? lol). IF ppc is still a gold mine, but getting tougher (or maxed out)...then diversify. Add bablefish, add new search technology, add PFI services, add whatever new thing I can think of, give access to a new customer base to my customers...then package, rinse and repeast (ACROSS THE WORLD).

Consider, PPC is barely beginning across the borders (frankly speaking). And I am mostly NOT referring Europe, not that Espotting is even considering such kinds of diversification (still fighting tooth and nail directly in PPC area). If I were espotting, in fact, I'd more worried than anybody.

I don't think ppl are givin this enough credit or overlooking this in search of deeper buy-out meaning. Of course, buyout is always on the agenda, remember OVER is a idealab venture (bill gross) and am sure that a fat check at some future date must be a consideration. But immediately speaking, buying AV just expands their potential product base for iteration across their global companies. Desparation my left foot. Remember that Overture is GREAT at expanding into foreign markets...they are great at turn-key solutions and iterating. Now they can do that with whatever "mini" products they can get outta AV...well worth the price. THAT above all else has been one of their biggest virtues. Investors will like that as soon as the first Overture PFI service comes out. The junk yard sale was a good analogy.

In this light as well, I also think Chris_F was dead on regarding the search engine algorithm. The AV search algorithm will be evaluated and tossed if it ain't up to snuff. AV's search is one of many things that comes from AV...but way behind in the "Plus 1 value-added sense" compared to all the other goodies (like patents). An interesting related thought is whether OVER is specifically testing the alogorithm just to see if it can cut down one of its biggest overheads: the 100+ PEOPLE in its US offices alone that have to approve listings (yup that's all they do)! People are a pain to manage and expensive. All business owners know that. Google has always had that advantage and OVER knows it. OVER would LOVE do something that would let them get rid of those people (and thus, increase margins) and not decrease listing quality (again just a thought).

Anyway, those are my 2...or 5 cents. :)

But one thing IS for sure, Over is good at keep everyone on their toes.



 2:25 pm on Feb 19, 2003 (gmt 0)


I hear you, but you didn't address a couple of important issues which are behind the desperation comments.

Again, I'm not following that closely, but from what I can tell, Overture had a great idea, pay for click. First to market. But VERY EASY to copy. Their lifeblood is clicks.

How big a chunk of their business is Yahoo? If it's 10%, then I agree with you. If it's 80% or so, then they are in deep doo doo the day Yahoo closes the doors. AV won't make a difference.

The reason it is viewed as desperation is that making a move like buying AV which would be viewed by their paying customers like Yahoo as VERY threateneing, this would push their clients into developing their own pay per click. Why would Over do that if they didn't feel that their clients would do so anyways.

And you made a great point about the employees. Google has replicated the PPC of OVerture, but in an ez automated way, allowing expansion etc much easier. If google wanted to sell paid results, they could ease the restrictions on their PPC and beat OV at their own game overnight, together with the best backfill in the business. I'm surprised G hasn't even thought of it yet...

I can see Yahoo automating PPC much quicker than Overture. When overture sells to companies search results, people are interested in the paid placement, not the backfill. So OV needs to laser focus on the paid results rather than the backfill.

To me, all the business signs point to desperation unless they have an angle no one thought of...but I doubt it..


 2:42 pm on Feb 19, 2003 (gmt 0)

Did anyone else notice unusually high spider traffic from AltaVista during the last few weeks? I didn't think anything of it, but now...?

One of those things that make you go hmmmm...


 2:52 pm on Feb 19, 2003 (gmt 0)

>MSN buys FAST?

Fast is in Norway. Microsofts' purchases outside of the US have been very few and far between.

I guess this action by overture finally ends a month of wild rumors and speculation that have been going on. The recent big one, was that Yahoo was in talks to buy Overture.


 3:18 pm on Feb 19, 2003 (gmt 0)

I agree with Grendel. Good points. This wasn't an act of desperation but a wise strategic move. O is changing with the market, just as Y is changing.

A battlefield must be viewed in two ways:
The things furthest away you must view as if they are at hand.
The things that are closest, you must step back and view as if they were at a distance. This is what O has done.

Brett makes a good point. But also, MS has been lethargic, and drags it's feet clumsily through the markets like a Frankenstein. I have a feeling that they're just now waking up to what's been going on.

Or they're agreeing to have a meeting to decide if they should have a meeting to talk about what the next move is.

[edited by: martinibuster at 3:22 pm (utc) on Feb. 19, 2003]

Learning Curve

 3:25 pm on Feb 19, 2003 (gmt 0)

Perhaps Overture learned a lesson from Inktomi about over-dependence on a handful of clients.

Perhaps Overture is moving to gain more control over their own destiny .

GrendelKhan TSU

 3:54 pm on Feb 19, 2003 (gmt 0)

I hear ya too clark, good points as well but let me continue with the devils advocate route(for sake of investigation) and try to kryponite ya...;)

1. I am quite certain Yahoo is not 10%, but its not 80% either and that is not a small premise to overlook. The question I elude to more is: what do revenues look like from Overture's foreign (and expanding markets) in comparison to yahoo US listings? Frankly, espotting doesn't keep OVER up at night, but I bet the reverse is true. OVER has free reign in Japan and is hitting other markets HARD. Now imagine AV is broken up into little AV pieces for repacking as value-added services. No more competitive threat to partners, yet added revenue streams and lower margins (via automated listing approvals?). Sounds good to me....as Overture AND an affiliate.

The reason it is viewed as desperation is that making a move like buying AV which would be viewed by their paying customers like Yahoo as VERY threateneing, this would push their clients into developing their own pay per click. Why would Over do that if they didn't feel that their clients would do so anyways.

Why? Cost, especially on the margin. Starting up their own PPC isn't NOT a small venture, even for Yahoo, and its even more expensive to get advertisers to convert dollars to Yahoo when Overture already has most of the advertisers cornered. Yahoo IS making fairly "free" money (as such things go) from Overture listings (revenue share on clicks). So, paying customer? yes and no. They are paid as well. Sure, one day Yahoo may go PPC....but in the meantime, OVER's move is neither threatening nor of desparation....but as a great way to ensure better sponsored services from OVER, at little if almost no cost to Yahoo.

Still, let's look at the other view, as an advertiser, if you are getting results with Overture and Yahoo starts its own PPC, do you necessarily DROP overture? Many will of course, but most won't (or frankly, most of the important ones) won't. As long as OVER is giving convertible results then why move? Maybe add, but not move. Further, most advertisers actually just expand their PPC advertising, but don't necessarily cut back on one to do so (again, the "important" one...sorry to say).

In other words, I would think OVER is more likely to chop AV up into usable value-added services, then try to compete as portal---a tough tough game (try goto again?...not!). Further, Yahoo US going PPC is light years from being the same thing as saying Yahoo Japan PPC. Noooo waaaaaaay Yahoo is iterating PPC fast enough (especially since its still even heresay in the US!) for Over to sweat over international PPC threats from its partners. OVER can make truckloads of more cash on the new PPC related services (gained from AV experiments) in US AND ESPECIALLY ABROAD before such services are even a twinkle in international-Yahoo-PPC's eye. Talk about value for investors and for a buyout! Now, THAT will create a true COMPLETE product solution that any of those others, like MSN, would scoop as Bill Gross retires for a life of a philathropy. Yahoo can do what they want with their PPC at that point....but they will still be play catch-up big time. So would it even be worth it? hmmm.....

I'm surprised G hasn't even thought of it yet...

Short answer: they probably did! just couldn't! :O

Consider....if you were starting out as a new PPC (primary purpose was to be a PPC) how would you automate an approval process for listings? Espotting obviously looked at the overture biz model, said "I can do that!". But with no convertable base of "netizens/end-users" (as google and GOTO did), Espotting went directly to advertisers and partners to start. So, the only automated system up to snuff was the Google one, but you can't use that if you have no end-users to click the links (or advertiser's listings would disappear immediately)...Not very much incentive for advertisers there. Thus, Espotting certainly wasn't interested in having its core competency be a "search engine and/or portal" right out of the gate, just as overture isn't now. IMO.

So, if you know of a system other then googles to automate listing approvals.....apparently the going rate is some portion of $140mill. LOL ;) let me know and I'll guartantee I can set up a few interesting meetings for ya (for a commmision of course..lol. jk).

whaddya think? Any more convinced? lol didn't think so...oh well, this is fun anyway. :D
**puts away kryponite** :P


 3:59 pm on Feb 19, 2003 (gmt 0)

Market comment [fool.com]

GrendelKhan TSU

 4:01 pm on Feb 19, 2003 (gmt 0)

Figures...while I was writing my freakin essay (shheeesshh too much coffee for me!), TomWait's very concise and convincing post came in (and others).

soo...um...yah! what they said! Ha!

lol. :P


 5:21 pm on Feb 19, 2003 (gmt 0)

There was quite a stir here when LookSmart bought Wisenut and just look how they have revolutionized the search industry! :)

I'd agree with Liane. I don't see any traffic from either Altavista or Wisenut and I've never heard of anyone I know using either search engine. It doesn't seem like somebody else buying Altavista is going to change any of that in the near future. I don't understand why Altavista would be worth that much money. I get more traffic from the Google search box on the Earthlink web site than I do from Altavista.


 5:24 pm on Feb 19, 2003 (gmt 0)

I will say this...

There will be more takeovers for sure, what is going on with the chart (NASDAQ:ASKJ) on AskJeeves? Something is happening here. As well with (NASDAQ:LOOK)

And even on a market down day (NASDAQ:ASKJ) is still moving higher, up 500% since October 2002, up almost 4.5% today

etrade [clearstation.etrade.com]

etrade [clearstation.etrade.com]

Do not forget that this industry is in consolidation and a bigger buyout than Overture with Altavista or Yahoo with Inktomi is almost a sure bet.

As Microsoft knows how to play hard ball there are more moves left and I think it is in the Microsoft court.

What say yee all?

[edited by: Brett_Tabke at 8:14 pm (utc) on Feb. 19, 2003]
[edit reason] fixed long url [/edit]


 5:28 pm on Feb 19, 2003 (gmt 0)

In 1999, CMGI acquired an 83% stake in the search engine for a whopping $2.3 billion in stock and greenery.

Ouch! A $2.16 billion write off. That hurts!


 5:45 pm on Feb 19, 2003 (gmt 0)

Would MS buy an outside company to do the SE stuff? I am not really sure they would. If anything, MS may have a home grown SE brewing in the back. They do have the money to buy just about anybody they want but when looking at other markets that MS is in and wanted to dominate, they have released a product of their own creation and marketed at a loss until the competition was crushed.

I could be wrong, since I don't follow MS in all their markets, but just from what I pick up here and there, a buyout isn't really their MO, unless they were looking for a quick way to squash the competition.

Maybe OV and Y! know something about this and are prepping themselves for a really big war. I don't know, just speculating in an uninformed sort of way.


 6:01 pm on Feb 19, 2003 (gmt 0)

>>but just from what I pick up here and there, a buyout isn't really their MO

Actually MS has a long history of doing this in the software field. They bought the code for DOS, Fox Pro and probably a few others. Online they bought Link Exchange and some other sites before the dot com bust.

The problem is that purchase by MS can often be the kiss of death - by neglect if nothing else. :)


 6:16 pm on Feb 19, 2003 (gmt 0)

Wow...I wouldn't expect Overture to go out and spend money on Altavista of all search engines. Don't they have enough problems with trying to battle out the other PPC engines? Why buy a sinking ship?


 7:12 pm on Feb 19, 2003 (gmt 0)

A friend made the interesting suggestion that this puts the torch to any talk of a Google IPO in the near future. Overture+AV do the majority of what Google does, and the current market valuation of both together went south immediately. These are unfavorable seas for a public offering.


 7:22 pm on Feb 19, 2003 (gmt 0)

Brett >> The recent big one, was that Yahoo was in talks to buy Overture.

So maybe Overture just took a poison pill to ward off a Yahoo acquisition.

And now Overture can offer MSN Alta Vista as backfill, clearing the way for MSN to rid themselves of Yahoo/Inktomi, and just maybe honing in on a nupital courtship with MSN. After all, if Yahoo boots Overture and replaces them with a home-spun Ink PPC engine it would make a lot of sense for Overture to sew tighter bonds with MSN.

Oh well, back to the soap operas.


 8:03 pm on Feb 19, 2003 (gmt 0)

At just one of my web-sites:

Out of approx. 9243 visitors over the last 104 days, I've had 63 visitors from Alta Vista. 1.63 percent. I'm ranked top 10/20 for my important keywords in AV.

Netscape and Ask Jeeves have given me more traffic than Alta Vista, but only slightly more.

Here's another anti-shocker. I've gotten more traffic from several quality, theme related links added in the last 50 days, than AV in the last 104.

More traffic from a link exchange in half the time than top 10/20 ranking in AV. (!?)

$140 million?

As far as I am concerned, AV is just your run of the mill web site. Over-priced and over-rated. As far as traffic importance, just an average web-site with a lot of history, a spider and a few bells and whistles.

I worry more about what Google, Yahoo, AOL and MSN are up to, in that order.

Heck, I will now worry about what 20 of my best link partners are up to. I hope none of them sell out for $140 million. I'd hate to lose their traffic.

Point made.

PS Someone mentioned LookSmart, Looksmart itself has given me 14 visitors. Wisenut doesn't even show up on my radar.

<added> I measure unique visitors on my home page only at that website.</added>

[edited by: Zapatista at 8:23 pm (utc) on Feb. 19, 2003]

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