Yahoo! Launches Pay-Per-Search

vasah20 writes: "ZDNet.com has this article saying that Yahoo is starting a pay-per-search service for 'premium documents,' in attempt to offset some of its revenue losses. Maybe it's just me, but if people can already find the most relevant results on Google, what are the chances anyone's gonna use this service?"

Comments

Read article - this IS Northern Light data

[Seth Finkelstein]

This IS the old Northern Light premium searching. It's not documents one can find in Google: (emphasis added)

According to the site, Yahoo plans to charge consumers between $1 and $4 to retrieve files from a specialized database of some 25 million research documents culled from 7,100 publications, including academic periodicals. Yahoo also expects to offer a "Premium Discount Search" option of 50 documents a month for $4.95.

Sig: What Happened To The Censorware Project (censorware.org)

Not what you think it is...

[Tazzy531]

Before everyone goes off an say that they will never pay for a search engine, please understand what Yahoo's plan is.

Yahoo isn't planning on charging for the searches that you do on its portal now, like the searches for the web pages. What they are offering for a fee is the stuff that you cannot find on any websites out there, where the publishers make them unavailable for free. Yahoo is moving towards the market that Lexis-Nexis is in now.

Many of you claim that this plan is unprofitable or nobody is going to pay for it. Think about this. Lexis Nexis charges $9/law review articles, $3/newspaper article, $4-12/SEC filings, or $129/week for Business news package. My school is paying into the 10K+ range for a site license per year.

This is definitely a highly profitable area.

Google is profitable

[Wee]

Has google shown a profit yet?

Actually, my new copy of Linux Journal came in the mail today. Doc Searls interviews Google's Director of Marketing in one of his columns. In it, he asks if Google makes money, and she says that they are in fact profitable. She goes on to say that their revenue is split 50/50 from ad sales and technology licensing (like with Yahoo and such). She said that have 130-odd customers for their search technology, and European and Asian sales offices opening soon. Customers pay for the bandwidth and servers. Actual customers who buy an actual product. A novel business model, wouldn't you say?

Anyway, since she was interviewed before the magazine went to press, I'd be comfortable in saying that Google has been profitable for at least 45 days.

-B

Google Isn't Immune

[Merry_B.Buck]

Google will start adding similar revenue-generating ideas, or their financial backers will start demanding changes.

Two-thirds of Google's revenue is from ads. They are opening new sales offices (e.g. Germany), but slowing down tech hiring. That suggests they are betting on increasing ad revenue at a time when their competitors have decided that ads alone can't sustain search-engines. Google's techie hiring cutback also suggests that they don't think additional software R&D can help them grow as much as investing in non-tech areas. [Estimates I've seen of Google's revenues are US$30M - $70M a year, with their CEO saying that makes them just about profitable.]

Worse for Google, they hold few patents for their basic technological advantage, and their infrastructure (including their huge database) could be rebuilt in a few weeks by a cash-rich M$. The only protection they have against Teoma et al is their staff -- but loyalty can be bought. (Google uses options to encourage employees to stay. If the options cease to look promising, some people will leave.)

Another problem facing Google is their staff itself. 50 of their 250 employees are PhD's. That means they have lots of valuable technical knowledge, but it also means that 50 of their highest-paid employees have a collective 0 years experience in business planning. Consider that their senior management lacks a CFO at all, and is loaded with CS doctors who tend (like normal geeks) to want to work on "cool" things instead of profitable ones.

Google's proud of its lack of advertising -- but don't they also lack the marketing that would produce such advertising? Look at two of recent new products: the USENET database (cool, but what good does it do for *Google*?), and the shopping-catalog database (a possible money source...but very risky, requiring licensees to share their revenue stream and catalog-shoppers to change their habits.)

Being private means Google can avoid stockholder demand for quick profits...sort of. Their only source of funds is two VC firms, since the founders had little money of their own. The two firms [1][2]-- each of whom has a seat on Google's board -- will eventually demand return on their $25 million investment. Remember, the folks who gave Google its money want to see profits, and have *lots* of experience in tweaking start-ups to generate them.

Don't get me wrong -- Google's great;Brin & Page deserve copious kudos & cash. However, I'm watching for some danger signs:

• Lots of new "Sales" or commission-based positions at company
• An exodus of employees. (With their high retention rate, "exodus" might mean 10 people.)
• Research efforts into non-Linux infrastructure.
• A lot of new product offerings that target consumers directly.

I'm also watching for signs I'd consider *good*:

• A removal of one (or both) founders from day-to-day operations.
• More parterships with content producers.
• Another level of financing (demonstrating VC belief that they can grow.)

Whew! (my $rant->time_complete=now();)