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I suspect it is the latter or a variation on it... why else would Overture co-operate on such a trivially small extensions period? If they were about to get the boot, would they agree to a 1 week stay of execution?
Whatever, it does look like change is afoot - let's hope it is not more bad news.
I would sure hope Looksmart does not figure into this equation.
2 major portals with the same top 30 listings, all bought, and all the same group of companies....well....yuck!
Never know after AOL's 54 billion quarterly loss [webmasterworld.com] though
With a 1 week extension, they are probably really close to agreement and they mutally agreed to extend the old contract 1 week at a time while they hammer it out.
Now, AOL could be negotiating a deal with Google as we speak, and bidding them off each other. We have two PPC engines. Overtures problem is no backup. They can't offer a portal like MSN or AOL a full search solution.
Google can offer portals an interesting offer. They can offer PPC (the revenue model) plus relevant results to help the portal gain/keep users.
Additionally, AOL can't really differentiate from MSN when they both server PPC and Inktomi results. Their individual "editorial" (high cost PPC) is the only space to differentiate.
Google results with Adwords as the PPC might be sufficient to get AOLers to stick around, helping them grow their traffic numbers.
OTOH, Overture's prices are higher, so if they offer AOL 70% of the revenue in return for more prominant positioning (the sponsered results are really poorly presented on AOL's search), maybe they stay alive.
My guess is that each company is bidding on this juicy contract. My good Google rankings make me cheer for Google, but I don't want Google getting a bigger strangehold...
Maybe Sprinkz/Ah-ha has something to offer...
I do SEO consulting for a major company that has close ties with Google. Apparently Google has the major inside track to become AOL's new partner. I would say Google is about 95% sure the deal will happen. The reasoning would have to do with Google's want to go public this year. This relationship gives them a better standing before they go public. Also, the user interface of the Google Adwords program isn't that great right now (not better than Overture's at the moment) so by the time they work out the kinks with their system, they will have become the major partner for both AOL and Yahoo, replacing the Overture relationship with both by the end of the year.
Regardless of who it is, if Overture does not continue with AOL, I fear for ODP.
Additionally, AOL isn't the only concern of Overture's at the moment. The firm also is contending with the potential loss or defection of Yahoo!, whose contract expires at the end of June. While the portal renewed its quarter-to-quarter agreement with Overture in March, executives at Yahoo! have said the company is looking into running a paid listings service itself.
There's also the possibility that Yahoo! can tap another provider for the technology, such as Google -- which already powers the sites' unpaid search engine.
Those two seem to have an implicit collusion strategy going. Instead of battling for marketshare and lowering prices they simply mirror each other as they ratchet up prices continuously.
Also, the user interface of the Google Adwords program isn't that great right now (not better than Overture's at the moment) so by the time they work out the kinks with their system, they will have become the major partner for both AOL and Yahoo, replacing the Overture relationship with both by the end of the year.
Sounds like you REALLY have the inside track and know what you're talking about - especially since Yahoo! inked a 3 year deal with Overture today.