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Diller On Why IAC Bought Ask

By - May 24, 2005

DillerBarry Diller took the stage at D today (see my interview here) and spent the first half hour or so talking about search, and why IAC bought Ask. Among the gems: “We were defensive about search…due to fears of disintermediation…but then realized….life will start with the search box.”

Diller went on to declare that search will be the de facto interface to the screen, and I certainly agree. He then told the story of how they came to the decision to buy Ask. The team made a graph of market share, and saw Ask at 6-7 percent, Google and Yahoo at over 30. Could IAC move Ask to the right, to gain more market share? “If the answer was yes, then the acquisition made sense,” Diller said.

Diller believes the answer is yes. He also believes Ask is a “differentiated” product, one that if more folks knew about, would take share from the incumbents. This is a process he’s run before – Fox was a differentiated product which took share from the three incumbent networks. “I love competing against larger players as a newer entrant,” he said. “Ask as a standalone company was constrained.”

Among other things, Diller hinted he might change Ask’s name from Ask Jeeves to “something with one word,” claimed that CitySearch broke even last month for the first time ever and is poised to win in local search through its vast databases of structured local information, and claimed that in the end, search is a media business (yup), and that Yahoo and Google will not be able to hold onto their commanding leads in market share forever.

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2 thoughts on “Diller On Why IAC Bought Ask

  1. Too bad no one in the meeting was there to tell Barry that Ask Jeeve’s marketshare isn’t actually 6-7%.

  2. I believe he is including ISH (Excite, iWon, etc.) in that figure….