Yahoo or Google; Yahoo tries Catch up

Ever wonder what Yahoo means? "Yet another Hierarchically Officious Oracle"; a worldwide directory of Web sites developed in 1994 by two Stanford University engineering students to organize Web content in a hierarchical system of subject categories. Searches in Yahoo! usually have higher precision because the Web sites it lists are selected by human beings, rather than robot software. Yahoo is the choice of only 25% of the 7.7 billion daily Internet searchers. Yahoo wants a recurring annual fee of $299 to use their express submission.

Google launched 4 years ago, uses a different methodology to list web sites and is simpler to use; 43% of all Internet searchers use Google. You can list for free, through open directory, on the Google site.

Since the inception of search engines a major problem has been financial viability. Yahoo has lost its premier standing among other search engine and is now in need of cash. In its efforts to recapture its lost market share Yahoo purchased Inktomi (a search technology specialist) for $235 million and Overture (a pay per click search engine service) for 1.6 billion.

Prior to Yahoo's purchase, Overture had acquired Altavista and All the Web ( both were major search engine players). 50% of Yahoo's operating cash is through its affiliate referral system with Overture.

Over the past year sponsored search ads, as a means of revenue, have become the fastest growing revenue source (30% growth) as compared to banner ads (10% growth). Google, as number one is preparing for the future by purchasing Weblog software developer Pyra Labs. ( more about boggers at a later date). The problem: a higher price for listing services disallows small commercial sites, special interest sites, or local services unless they have cash to pay for services. That, in turn, will make major search engines less relevant, and no longer useful. The wave of consolidation over the last year may lead to:

* - Microsoft's entry into paid search * - Google's further attempts to monetize its basic search process * - The resolution and merger of web search and "Yellow Pages" technologies * - The emergence of economically viable search and placement alternatives for smaller sites * - The emergence of new niche and "vertical" search tools that can provide frustrated users with better-focused, higher than average-quality results.