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Feb. 4, 2008 at 9:35am Eastern by Greg Sterling
IAC Troubles, Ask.com, And Post-Yahoo Search Share
The New York Times and Wall Street Journal both report on the legal battle for control of IAC's board and thus the company itself. It's not pretty, and IAC claims that it's impeding the company's ability to effectively operate.
The legal fight arguably prevents IAC from making any sort of overture (so to speak) toward Yahoo, although it's a much smaller company ($7.4 billion vs. $38 billion). Another issue to consider is the potential impact on Ask.com of a post-Micro-Hoo search landscape.
Ask and AOL jockey back and forth for the number four and five positions in the search rankings. A combined Microsoft-Yahoo would be a solid number two, with a roughly 31 percent market share according to the most recent comScore data. Both Ask and AOL hover just below 5 percent.
Ask is a differentiated product that might grab more attention in a newly consolidated marketplace, depending on whether and how Microsoft and Yahoo search came together. There's a potential opening there that Ask might hypothetically exploit. However, it's unclear whether the company can and will.
IAC has indicated a willingness to market on behalf of Ask.com but not necessarily continue to invest in developing its technology -- or at least at aggressive levels. The company's internal troubles, forthcoming trial over control of the board, and arrival of potential new management (if Liberty Media succeeds in ousting IAC CEO Barry Diller) could go either way: putting a fresh focus on Ask with corresponding resources or treating it like a cash cow and milking it.
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By Greg Sterling
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See Related Stories In: Ask: Ask 3D, Ask: Business Issues, Microsoft & Yahoo Merger, Microsoft: Business Issues, Yahoo: Business Issues
