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Is Google Really Ready to Take on Yahoo and MSN?

05/19/04

Browse the headlines of any online or printed news source and you would be hard pressed not to hear about Google's upcoming IPO. If you were to go home tonight and turn on the TV to watch your favorite sitcom, there is now a chance you might hear something about Google. When morning comes around and you check your email - I would nearly guarantee that you will hear something about Google's efforts to acquire another company, develop another type of service or respond to a recent "issue" in their search engine. The simple fact is, Google is everywhere.

While many would willingly admit that Google has impressed the critics, I cannot help but think that the tables may soon turn on Google's great PR machine. Google has often set the precedent for online marketing, but it has had to fight off what seems like a large amount of criticism from upset webmasters and business owners.

Just imagine how much more criticism will exist when Google becomes publicly traded.

Running a search engine optimization firm, I have always had to walk the fine line while talking with clients about Google. Explaining the effects of the Florida Update in a way that makes sense to a small business owner is difficult. Then again, it is a lot easier than being the person who tells a business manager that his new $80,000 content managing software effectively removes his site from Google's search indexes.

For countless reasons, SEM insiders can love or hate Google. But take a step back and imagine just how small the SEM community is. While SEM and SEO professionals would love to think that search-based marketing is a leading component to successful marketing campaigns, the budget and focus from consumers of our services simply do not exist.

When Fortune 500's are spending more than 10% of their marketing budgets on search based marketing, the landscape will change. But in today's markets, SEM barely touches the radar. Recent news coming from Yahoo indicates that spending on online advertising accounts for just three percent of all advertising costs.

So what… the press surrounding Google is enormous… And they have controlled the market for so long. They cannot be stopped at this point, right? Wrong.

While the most I can do is predict what could happen, I cannot help but think that the months following Google's IPO will ultimately decide its fate in our industry.

I see our marketplace as being dominated by three players at this point in time. Whether we like it or not, MSN, Yahoo and Google dictate how our efforts are focused. While many would like to think that Google is in the ultimate position of power, I tend to think otherwise.

MSN is a property of Microsoft. Since 1986, Microsoft has set the standard for publicly held companies turning profit and growing business. While MSN's entry into the search engine industry has taken time, how could you think that the step to move there is an uncalculated one on the part of Microsoft? I certainly would not, and with that in mind - I can only begin to think that MSN's search developments will create a significant buzz in our lives.

Even if the quality is not there, the money and ambitions backing MSN's search developments will not let failure become an option for a very long time.

Moving on to the next player in this game - we can turn our attention to Yahoo. When Google was learning how to become a search engine, Yahoo was learning how to become a portal. Normally, you would preface the term "portal" by giving it some descriptive clarification… A news portal… A dating portal… A shopping portal… An email portal. But that is not that case with Yahoo because Yahoo is all of those things and so many more. And each day we check the latest SEM news, all indications are that Google is making an effort to become more like Yahoo.

Good for Google.

I see Yahoo as being the largest player in this game, and certainly the most powerful. Yahoo has been publicly traded since 1996, and with 8 years of experience dealing with massive amounts of pressure from analysts, stock holders and the consuming public - Yahoo knows how to control PR forces.

And, while I cannot deny that Google has an enormous PR machine working right now to develop an advantage - I cannot allow myself to be naïve enough to think that Yahoo and MSN are just sitting back and waiting for Google to set the pace. Yahoo's Chief Executive Terry Semel was recently quoted as saying "We're quiet; we don't say a lot as a rule. But all we want to do is to win." That is the type of attitude that has always scared me in business… And this is also the kind of approach that Google cannot react to.

Looking at the many flops coming from Google in recent months, I think that Google just cannot find the right spin on things.

I want to hear from you though, the readers of this editorial piece. Where do you see the organic search markets moving to in the next year or so? How will the Google IPO impact your life personally? Please let me know!

Together, we can help to shed some more light on this developing situation and at the very least, make some sense out of all the possibilities.

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