Round one: AOL could buy a piece of Google

Today Reuters revealed that under a 2002 deal, AOL has the right to buy about 1.9 million preferred shares of Google Inc., the number one search engine, for around $22 million.

The relationship between Google and AOL has been pretty intimate since 2002 when Google started providing the organic search results to AOL’s web property and AOL Search. In 2003 when Google Adwords was launched AOL became one of the most important members of the distribution network for Google’s pay-per-click search advertisements.

To be sure, there has been a reverse side to this relationship: DMOZ (The Open Directory Project), one of the two most authoritative web directories which at the time was hailed as the alternative to Yahoo!, is owned by AOL and provides the backbone to Google Directory. In addition, because of their high quality, links incoming from The Open Directory to a website tend to help improve Google’s search result rankings.

Round two: What if Microsoft could buy AOL

With bizarre timing the New York Post published on Friday rumors that Microsoft is contemplating the possible purchase of Time Warner’s unit America Online. While the rumors were declined by the company spokespeople, the idea has sparked speculation about the impact of such a transaction on the search engine marketplace. A successful deal would increase the number of MSN subscribers from 9 million to around 31 million. Most of those users would continue using the web property’s respective search engine. Each of those properties today feature saerch results supplied by the two largest search engine competitors today, Google and Yahoo.

AOL Search is fully supplied by organic search results by Google and pay-per-click sponsored searches provided by Google AdWords. MNS currently features search results by Yahoo’s subsidiary Inktomi and pay-for-performance ads by Yahoo’s subsidiary Overture Services.

Round three: The search engine marketplace could be a very different one

It is well known in the industry that Microsoft is developing its own search engine whose spider, MSNbot, is already scouting the web. When this new search engine is launched, it would most likely replace the search results provided to MSN Search by Inktomi.

If Microsoft were to buy AOL, it is very likely that the outstanding contracts with Google would be honored but once completed, Google’s relationship with AOL would be over as well. Since AOL is currently the most valuable client for Google, any change of AOL’s ownership would have abrupt and lasting repercussions to the distribution of search results and sponsored listings.

While all of this is speculation, the notion that one should market a website over a wide network of search engines has never been more serious. Search engine marketers cannot ignore the dynamics of the search engine marketplace and should prepare for the day when things are not the same anymore!

3 thoughts on “MSN, AOL, Google in an odd threesome

  1. While the rumor of Microsoft buying AOL might be speculation, I do not doubt that given the opportunity AOL will buy a pre-IPO piece of Google. Yahoo might be a competitor of Google’s now but they are not giving up their Google shares knowing that the IPO could bring them some good return on investment.

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