|Overture Announces 3-Year Extension Of Deal With Yahoo|
Story here. [story.news.yahoo.com].
This part was also interesting:
|Still, Overture Chief Executive Ted Meisel said he had no new information to provide Thursday on the ongoing negotiations to win a new contract from AOL Time Warner Inc. (AOL). That contract originally was set to expire March 31 but now has been extended twice - with the latest extension, until May 1 , announced Wednesday - to allow more time for negotiations. |
I guess this ends the speculation as to what they were going to do for their PPC listings (in house, Adwords, etc.) for a couple of years.
Guess the question now is, will that be enough PPC revenue for them?
Sometimes leaks are negotiation strategies. Overture has higher bids than Adwords (which of course would shift if Yahoo ran Adwords). However, Yahoo and Google have VERY different audiences. Running Overture results likely makes more sense to Yahoo.
I predict Overture starts looking for a buyer. The mere existance of Google's Adwords as an option is going to hurt them. Their first round was a straight 50-50 revenue share (which is the most logical business deal when you are trying out a relationship).
Once it starts to make money, the portal can rape the PPC company, as they own the traffic, and ANYONE can setup some PPC.
Overture could hold the line at 50%, and some of the portals would switch to the smaller PPC companies. Or they can offer the higher percentages and try to re-monopolize the market.
Fun the watch, but Overture getting squeezed is NOT going to help the small webmaster, it's going to help the big-time webmaster with the budget.
that's kind of surprising. We thought that maybe Yahoo would roll out their own program. Must have been more profitable to partner with overture and take the cut. Yahoo is sniffing that affiliate crack and getting hooked.
|Once it starts to make money, the portal can rape the PPC company, as they own the traffic, and ANYONE can setup some PPC. |
Sure, but there is still an enormous overhead for creating a quality PPC system. Overture has a killer team of reviewers, a large base of advertisers that would take some time to build up on another portal, and a powerful anti-cheating software system. Of course others could repeat their work(ex: google, who skipped the reviewers part), but the initial investment is pretty large.
> Sure, but there is still an enormous overhead for creating a quality PPC system.
The difference between "some PPC" and "quality PPC" is a big one. Overture is showing the world how to do it right. They have a very client-oriented business culture (both their portal "feed" clients and their advertiser clients) and they care about the little guy in a very refreshing way.
It would be very hard for Yahoo to create that kind of business culture.
What tedster said!