Yahoo, Google Standoff

SILICON VALLEY – The official search engine war is on and it looks like search king Google and Yahoo are on almost even footing.

Only a week after the Internet portal announced plans to get rid of Google as a search partner and establish itself as an independent search engine, the tables have turned for Google and its rivals Overture and Microsoft, which have both been looking for ways to upseat Google as the dominant online search engine.

Prior to Yahoo's announcement that it plans to disengage from Google, Google provided search results for not only Yahoo, but AOL and Ask Jeeves. According to statistics provided by Searchenginewatch.com, Google powers 79 percent of all Internet searches, but both Google and Yahoo receive nearly the same direct search hits on their sites.

Yahoo CEO Terry Semel has said publicly that the partnership between his company and Google is officially finished in the first quarter of 2004 and is intricately connected with Yahoo's plans to shell out $235 million to acquire Inktomi.

Inktomi has been on the search engine game since 1996 and has recently laid claim to an algorithmic search technology that is similar to Google's. In the past, Inktomi has provided search technology for AOL, RealNetworks, Excite@Home, and NBC online, according to CNET.

Microsoft also uses Inktomi's technology, and industry analysts are waiting with baited breath to see what moves Bill Gates will make on the heels of Yahoo's divorce from Google.

"They will be a major player because they're Microsoft, but they don't win all ballgames," an analyst was quoted as saying.

Industry analysts are already predicting that once Yahoo establishes its own search engine identity, it could conceivably take 50 percent of market share.

The online search engine sector had been earmarked as a goldmine ever since Google proved to many competitors and industry watchers that huge advertising revenues can be made through paid and sponsored search results. Google's AdWords service has brought in enormous revenues for Google.

According to CNET statistics, paid search advertising spending, which has shifted the tides away from banner advertising, increased by 123 percent last year to $5 billion and is likely to grow another 500 million within the coming year.

According to reports, Yahoo's new search engine will closely resemble that of Google's in both physical appearance and functionality.

A representative for Google was quoted by CNET as saying that even after Yahoo and Google end their contractual agreement, they will still remain partners in other undefined areas. The representative also added that Google does not anticipate seeing any dramatic changes in its future, regardless of Yahoo's success as a self-powered search engine.

"This is a very big product space," he said. "If you look at Google's mission, it is to give people access to the world's knowledge. That's an awfully large space. There is certainly room for more than one search company and room for more than one way to search."

According to reports, Google is still poised to go public in the coming year, a move that could generate as much as $4 billion and give the company a net worth of $15 billion.

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