• Marketing Pilgrim , Friday, June 27, 2008 3 PM

Looks like the semantic search darling of many in the industry is about to be snapped up by the behemoth. Venture Beat is reporting that Microsoft is set to purchase semantic search engine Powerset to the tune of $100 million. TechCrunch, on the other hand, says that the deal is not finalized, and may be scrapped if Microsoft can still get its hands on some of Yahoo's search business. Andy Beal digs into what the strategy could be behind Microsoft's move, as well as the caveats of such a purchase.

"$100M is probably the amount of interest Microsoft's warchest earns in a day, so it's not a big acquisition for the company," Beal says. He argues that the mini price tag is indicative of Microsoft's realistic view of the challenges that any semantic search engine (let alone core search engine) will encounter in an attempt to gain ground in the search race. "Didn't Ask.com try natural language search?" he says. "Didn't it fail? Didn't Google spend the last 10 years conditioning search engine users to use a handful of keywords--not natural language?"

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