Even with the US Department of Justice effectively putting an end to merger talks between search engines Google and Yahoo, Microsoft still doesn’t seem to be satisfied. Ross Fadner, in his column “Around the Net in Online Media” reported Microsoft recently underwrote a new International Advertising Association survey in which 100 members responded to questions about search advertising power scares them. The bottomline? 65% said that the online advertising video market was dominated by Google, limiting choices and price options for online advertisers while 85% said it is important that a strong competitor emerge to challenge Google’s dominance.
Who is afraid of Google? Apparently a lot of people are, especially Yahoo Chairman Roy Bostock, Microsoft CEO Steve Ballmer and Time Warmer CEO Jeffrey Bewkes . The three reportedly met at Time Warner Building in New York to discuss strategies to stave off Google’s dominance, which by some estimates has a search share of 70%. Kara Swisher speculates Microsoft would buy Time Warner’s AOL for $4 or $5 billion dollars, and then spin AOL’s content, advertising, and communications assets into Yahoo. What effect does this have for advertising video executives?
Google, which represents 70% of the search advertising video business, has been tracking flat growth for most of 2008—a trend most likely brought about by the 8% fall in U.S. search spending in the 4th quarter, according to search advertising firm Efficient Frontier. However, James Beriker CEO of Efficient Frontier said although it was difficult to predict whether the next quarter would be better or worse, there were certain “encouraging signs.” At any rate, Google is set to reveal its earnings for the period this Thursday.
Meanwhile, online networking site MySpace has partnered with five new independent labels and indie music distributors beefing up the catalog of music available on MySpace Music. The entry of Nettwerk Music Group, INgrooves, IRIS Distribution, RoyaltyShare, and Sony Music Entertainment’s Wind-Up Records now makes seven indie labels which have partnered with MySpace. However, the online networking company has yet to finalize a licensing deal with indie giant Merlin which has been very vocal against the terms MySpace Music offers to its partners.
