mack - 10:27 am on Oct 30, 2009 (gmt 0)

No one is buying because Yahoo just doesn't developer like Google can, currently there is no way it possibly could. Its all about volume, if you can shift several million clicks a day advertisers like this, they see a quick return. The influx of advertisers keeps the cpc above any other mainstream pps system. If yahoo had the slots to show more ads it could potential attract higher budgets. Its like going into a Pizza place and they only have one oven, they can't supply in bulk. Similar with ads, the more outlets for your impressions, the more chance of sustaining a higher cpc.

Regarding bleeding money, bad choice of words, but throwing funds into a search engine that simply can't compete is as good as throwing money at the wind.

Personal I see this as buying market share, what price would M$ be prepared to acquire 4-6% of the search market? Powering Yahoo! then Ask. It sends a pretty clear message.

Mack.