Yahoo To Offer New Search Tool For Web-Based Research
Posted on: Wednesday, 4 February 2009, 17:39 CST
In a posting to its blog on Wednesday, Yahoo Inc. said it was testing a new tool called Search Pad, similar in concept to Google Notebook, a product abandoned by the Internet search giant last month.
Yahoo said its new tool would help users better organize the vast amount of information that often crops up during Web-based research.
However, that does not necessarily mean Yahoo is wasting its time, analysts say. Rather, the companies' different competitive and financial positions mean what is right for one might not be for the other.
Google, which dominates 63 percent of the U.S. Internet search market, is re-examining its operating expenses to maintain its operating margin amid the economic slowdown. Yahoo, on the other hand, is in dire need of a new growth strategy, experts say. The company’s revenue increased just 3 percent in 2008, to $7.2 billion.
Yahoo’s investors might be more open to new projects that pressure profit margins if there is a chance of a significant return, Collins Stewart analyst Sandeep Aggarwal told Reuters, speaking in general terms and not specifically of Search Pad.
"Yahoo cannot give up on other projects," he added.
Yahoo, which recently hired Carol Bartz as CEO to resurrect its business, is in a "transformation phase" after refusing a $47.5 billion buyout offer from Microsoft Corp last year. Its search advertising partnership with Google Inc dissolved under anti-trust scrutiny shortly thereafter.
The new Search Pad tool predates Bartz's arrival, Tom Chi, Yahoo’s Search Senior Director of Product Management, told Reuters.
It originates from a realization that Web surfers use search engines not only to locate a link to a certain site, but also to conduct research on a variety of topics ranging from new car purchases to seeking knowledge of certain medical conditions.
Search Pad detects when a user seems to be conducting research on a certain topic and offers to catalog results in a special window within Yahoo’s search page.
Search Pad can clip a portion of a website, such as a book review on Amazon.com Inc, and allows users to add notes to various clippings and store the results as part of their online profile.
The company will start offering Search Pad to a subset of Web surfers on Wednesday.
In the mean time, Google continues to support Notebook for current users but no longer provides new feature updates. And the company will not allow new users to sign up for the service.
Pacific Crest Securities analyst Steve Weinstein said Yahoo's best chances for capturing market share in the search business centers on user experience.
"As it stands right now, no one would shift from using Google, or any other site, just because (a different search engine is) one basis point more relevant," Weinstein told Reuters.
"They really need to find some kind of experience that will make people think Yahoo is unique," he said.
Weinstein, whose firm makes a market in Yahoo shares, currently has a "sector perform" rating on the company.
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Source: redOrbit Staff & Wire Reports
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