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Yahoo+Overture--may be a good for move for worldwide (or overall) perspective... but BAD BAD NEWS for OVER and Yahoo Korea.
I think once more I will toot the horn that Korea is a very unique market.
Though the purchase seems to have legimatized PPC advertising (which is good news for companies like Zingu as well as Over), it is generally seen as mistake or at least another huge obstacle for Over and Yahoo companies in this peculiar Korean market.
BTW, for perspective, cafe sites (esp daum) here are HUUUUGGEEEEEEEEELY popular (korean forums and bbs systems). One of Daum's biggest draws is its cafe system (analogous to Yahoo groups) and remember Daum is the top three site IN THE WORLD (according to Alexa). SEM related forums are nothing of course in comparison to here. But I wouldn't be surprized if they catch up fast. The industry only started months ago...and there are dozens of forums (PPC, SEM etc etc forums) and hundreds and hundreds of posts.
Here's what some of the buzz is: (gleened off some of the cafes etc and my added thoughts of course :P )
--The timing is seen as especially bad since Over is still struggling to establish itself here (on the up and up...but looooongg way to go before it reaches expectations). Not a good time to rock the boat and create direct competition with affiliates or have it seen as a big US company giant.
--Yahoo is NOT the number one portal OR search engine in Korea. In fact, its "only" number three or less. MSN is barely ever thought of at all for search. And lately, Yahoo has been continuing to lose marketshare to its local competitors. Thus, Over is more reliant on its other local deals then perhaps in other countries.
--Koreans are notoriously proud and nationalistic. Creating an even stronger big US company (YAHOO/OVER) offering may not turn out to be a negative factor...but then again it may. I am sure they are at least well aware of this possibility.
--Daum, OVER's biggest and perhaps most important affiliate here, is a heavily community based site and Yahoo's is one of its biggest competitors. I have read much in cafes already speculating Daum dropping Over (even though they have 2.5 years left in the contract). Daum has refused comment (well, completely middle road..."we continue to evaluate the situation" comments only.)
True or not and heresay as it may be, its certainly indicative. The communities have power here.
--Lots of remaining portals have been keeping a wait-and-see attitude towards PPC. They can, as I see it, ignore PPC, plug it in from exisiting PPC companies, or make it themselves.
The model is popular enough already that is seems more and more affiliates are jumpin on the bandwagon. So I doubt many will ignore it forever. I doubt many have the gumption or resources frankly to make it (exception being NHN, but that's a different story). So if, or likely, WHEN they do decide to go PPC.....their choices are Over and Zingu. Given the issues above, I am sure the Zingu guys are besides themselves.
The unknown is, of course, Google which is keepin a low profile for now...but I am sure that will change soon. Its not a very comparatively popular search engine here (as has been discussed in other threads), and it remains to be seen how they will inevitably approach the market.
[edited by: GrendelKhan_TSU at 5:05 am (utc) on Aug. 4, 2003]
Thanks!
It's interesting that the buzz is leading in this direction. I wonder how much this type of talk will have on the actual companies. Somehow I don't see Yahoo changing their strategy much because of it, but keep us posted.
The speculation of Daum dropping Overture sounds a bit far fetched. I don't see how breaking their contract would have any positive effects. However, I'm not the Korean market expert either ;) This will be an interesting one to follow.
GrendelKhan it sounds like you've been listening to our favorite writer over at the Korea Times too much ;)
lol! No worries...I definitely keeping an eye out to keep things grounded. I tried to keep the post to mostly just what the buzz is about. Besides, this stuff is WAAAAYY over our favorite writer's head. haha. Who knows how he would have wrote this post (probably something totally wacked "Yahoo is going bankrupt) heh.
Somehow I don't see Yahoo changing their strategy much because of it, but keep us posted.
nope, I don't either. Which is why I think it should be a valid concern for OVER. This market DEMANDS a personal touch that yahoo is not quick to respond to (if at all).
The speculation of Daum dropping Overture sounds a bit far fetched. I don't see how breaking their contract would have any positive effects.
oh yah, absolutely not. Total heresay, I think. Daum isn't that stupid, and OVER is still THE brand. I just mentioned it because I think its illustrative of the potentially precarious position this puts OVER in if ppl are already starting such rumors. (how's that for alliteration!: ppppp! :P)
Should definitely be interesting in the months to come.
