Overture Extends AOL Deal Until May 1

[Laisha]

Overture Services Inc. (Wednesday said it extended for one week a deal to display its search results on AOL Time Warner Inc.'s America Online Internet service.

Story here [story.news.yahoo.com].

[john316]

wow!

A one week extension; doesn't exactly sound like a long term partnership.

There must be a replacement waiting or negotiating in the wings ...wonder who that could be?

[Napoleon]

I am not sure how to read this. Could be bad news for Overture, or it could be to allow negotiation on how far to increase their presence.

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.

[NeoN]

Defiantely, changes are coming.. Look at MSN and AOL right now.. What they offer? Overture(PPC) + Looksmart(PPC) + Ink .
So, somethign strange, I would say..

My guess- AOL will go with Looksmart . The only change for LS to survive are AOL and MSN..

[NFFC]

>My guess

Google

[ckarimi]

I think Overture is definitely working on a further agreement with AOL. There is no way, a business would agree to a trivial one week extension, just like what Napoleon said.

[nell]

I was fired once and asked (begged like a dog) for a 1 week extension to prove to them I was worthwhile to keep.

Perhaps AOL gave Overture the boot, and they begged for a week extension to develop a stronger proposition to make to AOL.

It could already be a "fait accompli" for Overture.

[skibum]

With the already close relationship between ODP and Google, an AOL with Google SERPs, AdWords, and maybe Goverture listings at the top?

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

[ckarimi]

I was just about to say something about AOL's huge losses...it probably plays a role in this somewhere along the line. Has AOL's ISP number increased or decreased recently? Maybe the amount of users still using AOL might effect which direction they are heading with their search listings. Just a thought...

[alex_h]

I would rule out Looksmart. Microsoft and AOL HATE each other. There is no way the MSN doesn't own a real chunk of Looksmart, and there is no way that AOL will do business with them for that reason.

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...

Alex

[ckarimi]

Got some more info about this topic...

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.

[bigjohnt]

My bet says Google. How they structure it to make money for both companies could be interesting. AOL absolutely must focus on income, Google can focus on exposure. The Adwords concept does not appear ready for prime time - nor does it appear to me that there is enough income at this point to share with AOL.
AOL would benefit from the addition of arguably the worlds most relevant search engine, but they would still need to continue to favor their commercial partners in the SERP's.
This is going to be interesting.

Regardless of who it is, if Overture does not continue with AOL, I fear for ODP.

[pageoneresults]

There is another article that I just read concerning this same issue. What really opened my eyes was this statement at the end of the article...

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.

[internetnews.com...]

[skibum]

YAHOO!'s decision as to whether or not to completely monetize the directory will probably be dependent on the fate of Looksmart. If they start raking in the dough YAHOO! might dive in as well.

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.

[Napoleon]

My guess is that L$ are in the midst of discovering that they have embarked upon one bridge too many.

[Laisha]

...they will have become the major partner for both AOL and Yahoo, replacing the Overture relationship with both by the end of the year.

Oops. I didn't realize this had turned to talk of Yahoo.

Parallel thread [webmasterworld.com].

[Pots]

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.

:)

[cbs.marketwatch.com...]

[addall]

you know what? AOL is using Google Adwords now! I start getting traffic from AOL thru adwords. :)

[sodak]

According to this article, Overture has announced the end of its relationship with AOL:

[news.moneycentral.msn.com...]