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January 24, 2006

Yahoo gives up race with Google

Posted by David Hunter at 10:07 AM ET.

Jonathan Thaw at Bloomberg News:

Yahoo! Inc., one of the first Internet search companies, has capitulated to Google Inc. in the battle for market dominance.

“We don’t think it’s reasonable to assume we’re going to gain a lot of share from Google,” Chief Financial Officer Susan Decker said in an interview. “It’s not our goal to be No. 1 in Internet search. We would be very happy to maintain our market share.”

Yahoo!’s comments underline the difficulties any Internet company faces in trying to challenge Google’s dominance of the Web search industry. Google has at least double the market share of Yahoo! and Microsoft Corp. in Internet search, the largest and most profitable segment of online advertising.

Danny Sullivan comments at

It’s important to note that Decker’s talking about search market share. Yahoo may not think it possible to overtake Google in terms of actual searchers, and saying that up front lowers some expectations among investors that are expecting to see gains.

Still, if Yahoo’s not expecting to overtake Google — and it’s the firm number two player — it doesn’t speak much to MSN’s chances to rise.

As I said in the Bloomberg article, it still seems like you would want being number one as a goal, even if you think it may be unrealistic or one that will take a long time to achieve.

Sullivan’s rationale is the only one that seems plausible – by saying this the company avoids complaints that it is not gaining against Google.

Filed under Coopetition, Google, MSN, MSN Search, Yahoo

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2 Responses to “Yahoo gives up race with Google”

  1. The Intuitive Life Business Blog Says:

    What do Yahoo, Apple and Ferrari have in common?

    The blogosphere is abuzz about the quote from Yahoo’s CFO Susan Decker to Bloomberg News (as run in The Seattle Post-Intelligencer) about Yahoo! search and Google. First, here’s her exact quote: “We don’t think it’s reasonable to assume we’re goi…

  2. Microsoft News Tracker » Yahoo techies aghast at CFO revelation Says:

    [...] The reactions to Yahoo CFO Sue Decker’s comment that Yahoo would be content was content to retain its second to Google market share in Internet search range from dubious claims of “out of context” quoting to a list of all the enhancements Yahoo is making in search. My interest in this is purely as an indication of competition for Microsoft’s MSN Search and frankly I’m not convinced that Yahoo has the will to play. It wouldn’t be the first time in the history of technology companies that financial folks surprised the techies. If Yahoo wants to do some damage control, they need to trot out Sue Decker to merely say she misspoke, but that won’t really fix it either. Filed under Coopetition, MSN, Google, MSN Search, Yahoo Listen to this article   [Permalink] [...]

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