AOL To Find Another Search Provider?

Providing only a paltry 2.5% of the whole search market, you wouldn’t think that this story was much of a big deal.
However, read on. AOL seem to be considering switching search providers from their current pick, Google. The deal is currently reported to be worth $700m a year, so it’s a fair bet AOL think they can negotiate themselves a better deal.
A combination of Bing/AOL would increase Bing’s market share to over 30%. However, the interest here comes from the click-through rate, defined as the ratio of advert views to the number of clicks on it. The click through rate of AOL, due to the demographic that use it, is more than double that of Google’s. This means that their share of the PPC market is actually over 6%, despite the search share being only 2.5%. Given that this is one of the main revenues of the search engines, this makes AOL an attractive prospect.

Furthermore you would think that pretty much the only other alternative now is Bing, who are currently powering MSN and Yahoo searches. Not so, AOL CEO Tim Armstrong confirmed recently that they were listening to offers from other parties,

Search is heating up from a multi-partner space – we are not just talking to two companies

It is currently not clear whether AOL will opt to stay with the big boys, Google/Bing, or switch to multiple smaller search partners. An announcement can be expected soon, as AOL are keen to get the deal sorted and start picking up advertising revenue. Place your bets now!

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