How will a GooHoo deal effect PPC?

For those who have not heard, there are new bites and rumors about a potential deal between Google and Yahoo. This deal could be worth $1 billion in revenue to Yahoo. Under the agreement Google would serve ads in Yahoo's search results. It seems to me that there are pros and cons to Google serving its ads in Yahoo’s search results. These are five items that came to mind when reading about a potential Google/Yahoo deal.

Pros of Google Yahoo Advertising Deal:

• More search advertising through the same Ad Words interface: I am a fan of the Ad Words interface. I think its leaps and bounds ahead of anything thing else out there. Being able to conduct both Yahoo and Google advertising in the same interface would save me a bunch of time and frustration.


• Ward off the Evil Empire: while I would agree with the notion that Google is attempting to take over the world, I would rather have Google running things that Microsoft. The Microsoft hegemon is always looking after itself. The Google hegemon on the other hand realized a long time ago that its interests were tied to its customer’s satisfaction.

Cons of Google Yahoo Advertising Deal:

• Quality Issues: I have always felt that the leads I received from Google were much better than the leads received from Yahoo. I suspect this has to do with the demographic differences in users, but neither of the search engines has been willing to share their market research with me. I suspect in Yahoo’s case they either don’t know or my account manager does not know who knows (if that makes sense).


• Pricing Instability: Those who conduct a lot of competitive SEM will know that the PPC market can be lively. Adding an additional, and large, channel to Google’s network would force prices to find a new equilibrium. Also, Google’s clicks are generally more expensive that Yahoo’s. Will Yahoo’s clicks (served via Google) become more expensive or stay the same? Will Google clicks get devalued? In the final analysis is would probably be different for everyone, depending on how you set up your campaign and your industry. Maybe the Ad Words interface would give you the choice of networks.


• Possible Algorithm conflicts: My first question is who’s algorithm chooses the ads? The obvious answer would be Google’s but will there be any interaction between Yahoo’s search algorithm and Google ad serving algorithm? Example: Yahoo tries to guess what you really want, then Google takes those results and further tries to guess what you really want. I guess this is a minor problem as both Yahoo and Google employ smart people who will be able to work it out.

Please share your thoughts.

Why Google Docs is HOT and Office Live is NOT.

Functional Office Suite entirely web based = HOT
Web based sharing tool, without the abiliy to edit documents = NOT

Things are changing in the software world. Software is shifting from something that you buy to something that you rent. This movement is called Software-As-A-Service (or SAAS). Software companies like it due to the magic of recurring revenue. Users like it because they will always, if the provider is any good, have up to date applications. If this software is web based and runs inside a browser window (so it can run on any computer, those who know the history of Java should be feeling like you have been here before), you have a force to be reckoned with. Google has taken Open Office, SAASed it and provides it for free. Recently, Microsoft, not wanting to be outdone rolled out with Live Office. Microsoft wanting to compete with Google, stole Google's interface and applied typical Redmond thinking (more on that later).

How Google Documents (or should I say SAAS) Has Changed My Life:

Google documents has fundamentally changed the way I use computers. I no longer carry a flash drive full of my documents. When I need to work on something, I log into Google documents and there it is. Take for instance, this blog post, part of it was written on my six year old iBook, while watching TV with Crystal (my significant other), it was later finished on my new iMac. I did not have to transfer files between the computers and if I wanted to use a Windows box, I could. In fact the laptop's batteries died while I was at Crystal's house (something to do with not charging it for a week) but I was not worried. I knew that my work was safely stored on some Google server somewhere*. Furthermore, when I want to share a document with someone, I simply give them access.

Don't get me wrong, Google Documents is a work in progress. The documents are not the best when printed, presentations leave a lot to be desired, my favorite excel tool, Pivot Tables are just not present and forget about macros. However, the strength of the online platform is enough to dissuade me from actually using an office suite on my personal computers. I would guess that it would be possible for a, broke, adaptable college student to complete their entire academic experience in Google Documents.

Where Microsoft Went Wrong:

As I said, my personal favorite tool, Pivot Tables are not present in Google Documents. Microsoft had the opportunity to capitalize on this. Why not take Office, SAAS it, wrap around the online sharing and presto, killer app. However, Microsoft was thinking with their pocket change not their portfolio. What I mean is Microsoft appears to not be thinking about the long term implications of SAAS, rather they are trying to reinforce the old model. As I am cheap, there is little chance that I would pay for Microsoft's service. However, many business would. And for guys like me, there is always contextual advertising.

As it stands now Live Office is only a sharing tool. It lacks the ability to actually edit the documents. Creating a SAAS type office application without the ability to actually edit the documents is about the same a making a doomsday machine and not telling anyone... pointless. This behavior of doing something half-way so you can still sell your software through the traditional channels is what I would expect from Microsoft. Furthermore, the idea that they would give their software the ability to run anytime anywhere thought the magic for the Internet is Microsoft blasphemy.

Now to be fair, Live Office does have some advantages for people who are not wanting to host their own Exchange server. But really, really... I want a web based Pivot Table.




* Those of you reading this in your bunkers, with your tin foil hats, please chill out. At no time did I say this was a perfect system... or that Google is watching you... which they are...