Yahoo-MS deal unlikely to shake up mkt share

Written by fe Bureau | New Delhi | Updated: Aug 1 2009, 05:14am hrs
The Microsoft and Yahoo deal, which is being termed as one of the biggest alliances that the technology sector has witnessed in a long time, is not expected to create any major shake up in terms of the market shares enjoyed by the lead players in the country, according to industry analysts.

Despite the fact that the Microsoft and Yahoo combine (or Microhoo as the alliance is being loosely referred to) will enjoy a combined market share of 28% of the Internet search market in the US and 11% globally, the duos share in the Indian market is much lower at 6.1% (according to ComScore data). Google is the dominant player in the country with a share of around 82.5%.

According to analysts, while the association will definitely create a lot of buzz and may prompt users to

try out the new avatar of search with Bing, it will be difficult to get the majority to migrate to it. Alok Kejriwal, CEO and co-founder of a leading online games portal, Games2win said that India discovered search via Google and consumers are unlikely to go up to Yahoo or Bing now. However, he adds, The Yahoo home page is still a much favorited page amongst Americans. So, the new power that Bing will provide will enhance the proposition for them.

Reasoning why Google is the dominant player in search in India, an analyst with a IT market research firm said that Indias search is still highly text-based compared to the global trend where a lot of generic and video search happens. He added that while Google is the first choice for text-based search, Yahoo is strong in the video search space.

While it is definitely a good tie-up as it marks the coming together of two forces, drastic changes will not happen overnight, said Deepak Kumar, general manager, communications research, IDC India. Diptarup Chakraborty, principal research analyst, Gartner added though market shares will not change in a big way in the short-term, at the same time, growing competition could result in improved search technologies and new ways of serving ads in the global market and these might come to India.

Industry sources also add that while both companies see India as a strategic market due to its under-penetrated Internet potential, activity around this deal will be focused on the US and Europe market and India-specific tactics will be few and far in between. Though advertisers will now give more weight to Microhoo than before, the actual shift will only start happening if the alliance manages to garner close to 50% market share.