IAC/Interactive Corp.’s announced agreement to purchase search engine Ask Jeeves in a stock deal valued at $1.85 billion stands to heat up competition in the already competitive search market. “The acquisition by Interactive Corp. was imperative for Ask Jeeves, which required a greater base of capital in order to continue to innovate on a par with Yahoo, Google and MSN,” says Ken Cassar, director of strategic analysis at Nielsen/NetRatings.
In terms of market share, Ask Jeeves' search properties have significantly lagged behind those major engines as well as AOL Search. In January, Ask Jeeves.com and two other Ask Jeeves search properties, Myway.com and Mysearch.com, ranked 6th, 7th, and tenth, respectively, in their share of total U.S. web searches tracked by Nielsen/NetRatings. That month, Google lead with 47.1% of all U.S. searches, followed by Yahoo Search at 21.2%, MSN Search at 12.8%, and AOL Search at 4.7%. AskJeeves.com at 1.8% of searches was ranked the same as Netscape Search with 1.8% of searches, while Myway.com, ranking seventh in the top 10, pulled in 1.4% of searches and tenth-place Mysearch.com pulled in 0.8% of searches.
By acquiring Ask Jeeves, IAC gains a strong base of female Internet users. According to tracking service Hitwise, 57% of AskJeeves.com users in the four weeks ending March 112 were female, as were 55% of Mysearch.com users. Typically, according to Hitwise, males make up a larger percentage of search users.
The acquisition also will further boost the presence of IAC properties online with distribution across the various Ask Jeeves search properties. IAC owns more than 40 online brands in the retail, travel, ticketing and other industries, such as HSN and HSN.com, Expedia.com, Hotels.com, and Ticketmaster and Ticketmaster.com. IAC has said it plans to promote Ask Jeeves search on every IAC site, which will expose 44 million unique visitors per month to the Ask Jeeves brand.
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