Diller: Ask.com To Continue Outsourcing Paid Search

by , Sep 20, 2006, 6:00 AM
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When IAC purchased search engine Ask.com last year, one of the company's priorities was developing its own paid search platform for advertisers. But Barry Diller said Tuesday that the company has since changed its strategy. Now, he said, IAC is focusing more on drawing consumers to the site than selling its own pay-per-click ads to marketers.

"Queries will build revenue," Diller said at a Goldman Sachs investor conference. He said the company's goal is to capture 10 percent of search queries--up from around 2 percent on Ask.com now and 5-6 percent considering other offerings.

Although Ask.com launched its own paid search product last year, several weeks after IAC completed its $1.85 billion acquisition of the company, the product existed side-by-side with paid search ads powered by Google. IAC's contract with Google doesn't expire until the end of next year, and Diller indicated that Ask.com would either extend with Google or tap Yahoo or MSN for paid search.

"There are three players who seem to be anxious to talk to us about serving ads after '07," Diller said, adding that it apppears more efficient to use other companies to power paid search while Ask.com focused on garnering more search users.

Diller also said that year-over-year search volume had grown by 40 percent. "Little by little, in this huge market of queries, of search share, we're making progress," he said. "I've never thought that success goes to the entrenched."

New data released Tuesday by Nielsen//NetRatings showed that last month, Ask.com accounted for 2.3 percent of searches, up 30 percent year-over-year.

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