Google and Yahoo! – Prospects for Revenue Growth
Here’s some data that provides an interesting perspective on the Google/Yahoo deal announced last week.
While this deal does seem to be a pretty clear win for both parties, the audience overlap data below suggests the possibility that we should be wary of the most optimistic incremental revenue scenarios. Given the fact that 77% of Yahoo searchers also search on Google, it is possible that there may be a material number of instances in which a person searches on Yahoo and does not click on a sponsored link, and then searches on Google and clicks on a sponsored link.
With the Yahoo/Google deal in place, this person would not need to execute the second search on Google. This would simplify the experience of the searcher, but would not generate incremental revenue for Google. Yahoo, however, would get a cut of search revenue that it would have otherwise lost. The scope of this behavior in the future may ultimately be what determines whether Yahoo or Google got the better end of the bargain.
