Android phone with Yahoo search

March 3, 2010 by · Comments Off on Android phone with Yahoo search
Filed under: Technology 

No, it’s not a typo.   AT&T pulled Google search out of the new Motorola Backflip apparently due to contractual agreements between the carrier and the search engine as reported by MocoNews.  I just think it’s funny that the reason Google got into the mobile world by developing Android is to take advantage of mobile search.  Yahoo, who also wants a  piece of the pie seems to have a better and cheaper mobile search strategy that does not involve a new mobile OS.

Of course, one can always change the preferred search engine on the phone once you bought it.  But it defaults to Yahoo in this case.  Android’s biggest advantage is user customization.  This is like the antitrust fights agains Microsoft for embedding Internet Explorer with the OS “abusing” its leadership to force people to use I.E.  Like people won’t download other browsers!  It is really a hassle to download Mozilla, Chrome, or Safari, right?  Who wants to do 3 clicks?  Not to mention the fact that I.E. updates require more than 3 clicks and it gets updated more often that most geek’s underwear… But let’s not go there.

The trend of Androids with Yahoo, iPhones with Bing, Symbians with Google, Blackberries with Lycos (not sure if it still exists) and all permutations and combinations of those is what’s interesting.  The most useful feature of smartphones (besides the phone) is search.  How many times have you been in a restaurant and wanted to go watch a movie?  Who calls the theater anymore? But now the Search engine, the OS and the smartphone itself are independent entities.   By that I mean that you can go to your favorite website and buy a phone, pick your OS, your service provider and your search engine.  Cool!

It is also entirely possible that carriers and device manufacturers are so pissed at Google due to the Nexus One release that they are cutting them out of the loop.  Perhaps.  But if the trend goes on, for whatever reason mobile search will be up for grabs.  And, my fellow reader (singular) our mobile search is worth money, lots of money!

So when are we going to get service subsidies (i.e. lower data plan costs) from the search engines?  Picture this:  You go to your preferred service provider’s website and choose your plan, phone, OS, and accessories.  On the next screen you pick your search engine which includes an extra incentive.  Yahoo may offer $5/month rebate, Google $50 for accessories, Bing something else.  Now, that’s driving choices.

Google:  If you want to be back in the Android (what a funny incident) subidize people’s data plans and stop making your own phone.  Well, not really, just subsidize my data plan. 



In Search for Search Leadership

July 2, 2009 by · Comments Off on In Search for Search Leadership
Filed under: Business, Technology 

Microsoft launched Bing in June as a re-branded, fresher looking version of Live Search. This is one more of the so far fruitless efforts to make money in the fast growing search industry. Last year, right before the economic meltdown, a bid to acquire Yahoo for $40B failed (Balmer, Microsoft’s CEO is probably thankful for that now.) Bing launched as expected with a huge marketing campaign (maybe actually clever) that goes after Google, so far #1 seated and far, far from the other 2. Is the investment worth it and how long will it take to pay back?

According to Internet data firm StatCounter, Microsoft gained a point of market share of US searches right after its launch in June 3rd to around 8.23%. At the same time Google’s declined slightly (0.24% to 78.48%) while Yahoo remained almost flat at 11.04% . Interestingly, during the first week, Bing accounted for 92% of searches to quickly stabilize at around 8.23%. Interesting payback for an estimated $3B investment (so far) in search by the software giant. Although it might trend as a positive market share growth it is not clear how long will it take to move the needle on Microsoft’s earnings. According to Yahoo finance (interesting choice of source) was a staggering $17B in fiscal 2008. Compared this to a mere (yeah, right) $4.5B of Google in its fiscal 2008 it seems like a battle not only tough to win, but the prize may not be as expected, especially for share holders.

Think about it. Google’s 78% of the market represents less than $4B in earnings. If Microsoft reaches, lets say 10% (1/8 of Google’s), and assuming the same cost structure it will earn $500M (or a 3% earnings increase). Yeah, yeah, I know what you’re thinking. These numbers are bogus and the bet is on growth. Sure, but to make a decent move on MSFT’s earnings, let’s say 10-12% (or $2B) they will need 4 times more earnings, which will mean a significant market share gain over Google and a never seen before growth (the market doubling and their share doubling doesn’t seem plausible). If everything else remains constant, that will mean $2 -$2.5 share price increase. Whereas a market doubling and a 10% share loss for Google will mean, well a 50% share price increase (yes $200/share). Sure more bogus numbers since MSFT is trading at <14 times earnings and Google at almost 30 so the market has already factored in a faster growth for the latter. It still illustrates the point that Google is better positioned to profit from search than Microsoft even if Balmer succeeds with Bing. Keep in mind that updates on both Yahoo and Google are expected in 2009.

This brings me to the real point I wanted to make. We all tried Bing. A gorgeous site, looks great and it works great. But the results are the same if not worse as with the other two. So as creatures of habit, like all geeks and online shoppers are, we all went back to our comfort zone. We will probably keep trying Bing a couple of times and it will probably succeed in taking on Yahoo’s #2 spot. But it will take a whole bunch of billions for people to conjugate Bing. I don’t know about you , but being “googled” is a lot better than being “binged”.