Read a bit over the weekend. First, the B’week cover package timed for the IPO is entirely reconstituted pablum. You’ve read this piece before, don’t bother. However, there is an interview with Page online, here, worth reviewing if you’re into that kind of stuff. Best quotes:
Q: Where is search today on an evolutionary scale?
A: People have consistently underestimated the size and importance of search. It’s a very, very large space of technologies, usage, and information. We’ve gone from 30 million to over 3 billion documents in just a small number of years. There’s going to be a lot of commercial activity in this space, a lot of companies doing things that are going to be very valuable.
Q: Competitors want to build search that simultaneously queries an individual’s local computer, e-mail archives, as well as the Internet. Is that something Google aims to do?
A: Our mission is to organize the world’s information. Clearly, the more information we have when we do a search, the better it’s going to work. There are all sorts of details involved in different kinds of products, including privacy issues. I’d expect us over time to have access to more information.
Second, there was a big cover story on Diller and IAC last week, in the same issue of Fortune as the Moritz piece I blogged a few days ago (sub required past first page on both). The piece was written by Bethany McLean, who is credited with breaking the Enron story. And while I was particularly interested in how IAC – a non-centralized, non-consumer facing company built on a confederacy of otherwise unconnected brands – competes with centralized, software-and-analytics driven companies like Yahoo and Amazon, Bethany did not address those issues. There’s a fine history of Diller and IAC, trademark analysis of IAC’s numbers, almost reverential profiles of IAC execs, and classic Fortune hyping of a potential “gotcha” (“Cover tag: “What’s real and what’s fantasy?”!). But there’s no gotcha.
The piece does have clues to what I think will drive IAC’s future. In the last portion of the story, Diller talks about “eventual synergies” in his operating businesses. I think the company’s long term fortunes will turn on the timeline of these “eventual” synergies. So… what drives synergies between lines of business online? Yup, search. Not to bang the search drum too loudly, but, the core asset IAC lacks most is search – a hole the Fortune piece missed, for the most part, though Diller does rue his loss of Lycos years ago. I certainly believe that regret is heartfelt. ” Those dopes!” he says of the folks who fought him on the Lycos deal. “We were going to wire all out commerce to the No. 3 search engine at the time when habits were just changing. Our company would have been so far advanced!” Looking at what Yahoo, eBay, MSN, AOL, Amazon, and Google are trying to do now, I have to say I agree.
interesting thoughts on IAC. the mass of recognizable brands that they have is astounding.
i think their recent acquisition of tripadvisor (travel content) shows that they are interested in wrapping up the whole search-find-obtain process that you’ve talked about previously.
iac seems to do a lot of advertising for its properties on other portals, especially msn. Besides their own brand awareness, as you say, they are relying on pulling people to “find and obtain”.
however, for their main online markets (travel & events), I don’t think that they are that weak in search.
where do you go when you want to search for a flight?
where do you go when you want to search for a restaurant or bar?
Where do you go when you want to search for a local event?
Where do you go when you to search for a hotel?
where do you go when you want to search for concert tickets?
Where do you go when you want to search for a potential date?
I’d assume many people’s answers are:
expedia or hotwire, citysearch, evite, hotels.com, ticketmaster or tickets.com, match.com. as you know, they are all IAC properties. They all have search capabilities for their content, and each of them possess the most complete content for their niche.
Of course, those sites don’t have absolute brand awareness among all of their potential customers, but it is high. So, they are missing a portal or search engine when people that don’t know about those sites do a search.
The question is, does the cost of acquiring those customers via banner advertising, text ads and other online marketing methods exceed the cost of purchasing and operating a portal/se. They have the cash. If it were cost effective to purchase a leading portal, what are they waiting for? Do they have relationships with existing portals that they would jeopardize?
I’d think that ask.com would be ripe for IAC to pluck. Especially now that ask has several brands (myway, iwon, excite) of its own, and since they have their own search technology. With IAC’s ability to push traffic to its different properties, they could easily bring ask or any of those other portals to the next level. And after building a leading search engine through brut marketing force, they could preferentialy send traffic to their “obtain” properties.
I have to agree with Peter and John: IAC is different from, and possibly lesser than, the other major net heavyweights because it’s failed to create “portal power.” (Or in other words, “failed to knit all its properties together with search.”)
It missed the Lycos opportunity, and perhaps that’s just as well. Ask Jeeves is a strong brand that has unifying power and could be another piece of the IAC puzzle. Besides which, they’re the only major search property that’s left on the table, and their apparently inflated stock price reflects how attractive they might be to certain suitors at present.
The bonus to the public and to search junkies at large, in the midst of a deep-pocketed conglomerate, the Ask Jeeves/Teoma search division could actually settle in for a long-term process of doing what we hoped Jeeves would do in the first place: build a better search engine!! … a really different, really intuitive way of searching that’s helpful to the average consumer.
I read the Fortune piece. It pretty much missed the whole boat. Barry has been talking about synergies for some time — years. It’s his whole investment strategy.What’s a lot more interesting is how he has set his relationships, the power he holds specifically over the travel industry (the rest of it is mostly icing on the cake) and how that industry is desperately trying to fight back.