AOL CEO Tim Armstrong noted that the company is in talks with at least three different search providers. While the current deal with Google was worth $700 million for the past two years, the fact that it will be expiring relatively soon seems to be giving both companies a chance to consider their options. AOL won’t even comment on whether they’re likely to conclude an exclusive deal with one company, or parcel the service among different providers.
With Google at the top of the heap, some observers think AOL should continue that relationship. As the saying goes, however, if you’re number two, you try harder. AOL may be able to negotiate a substantially better deal with Microsoft or Yahoo than the one they had with Google. Taking into account that Microsoft and Yahoo are merging their search technology, such a deal could create a search alliance that attracts more than 30 percent of searches, according to comScore. That should be enough to make Google at least marginally nervous.
AOL may even choose not to negotiate an exclusive deal with Microsoft, leaving it open to partnering with search engines aimed at specific niches. A company that focuses on local search, or searches related to topics like finance, might not be out of line. And it would allow AOL to offer its visitors something that Google may not be able to provide quite so easily.
Additionally, Yahoo’s services could come into play. Not everything the venerable search engine offers will be going away when it merges its technology with Microsoft. For instance, Yahoo still offers a respectable mobile search product. Indeed, just three months ago, the company struck a deal with Samsung to pre-load its mobile search on millions of the manufacturer’s devices – including some that run Google’s Android operating system. It’s worth noting that Yahoo’s mobile search service was explicitly excluded from its deal with Microsoft.
Of course, December is still five months away, and negotiations could run right down to the wire. It may even be in AOL’s best interest to keep people guessing. At the very least, the idea that a search alliance could eventually grow to challenge Google adds a little bit of intrigue – and interest – to the search engine competition.
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