Overture gets some serious competitors delivering paid search results

(Feb 5 2002, updated Feb 7) We have all seen them: They look like search results, they taste like search results, but they are really text ads delivered by the Overture company.

They are all over the place, on the American versions of Lycos, HotBot, AltaVista and Yahoo!, normally camouflaged as "featured results" or something similar.

This is great for Overture, which has been close to achieving a virtual monopoly on paid results in general and on pay-per-click results in particular.

Yes, there are other pay-per-click search engines out there, a lot of them, but after FindWhat lost Excite, none of them feed results to one of the major portals.

European challenger

However, the market forces have not given up the struggle yet. The UK company Espotting is challenging Overture on the European market, and is now delivering text ads to major sites like Yahoo! and Lycos.

Overture is not giving up Europe without a fight, however. It has recently started delivering paid results to MSN UK, and has also signed a deal withe the European version of AOL.

As always, the situation is much more complicated in Europe than in North America, due to different markets, cultures and languages. At the moment Overture is serving AltaVista UK, while Espotting is delivering paid results to AltaVista in France!

Still, the fact remains, Overture is not the champion of the European market.

Google AdWords in North America

Overture is also picking up some competition in North America. The challenger is Google. This will come as a surprise to many as Google is known as the search engine with no pay-per-click results.

This is true in the strict sense, as Google serve no paid search results where the advertiser pays per click-through. The search engine does serve text ads, however, ads that are linked to the search query entered by the searcher.

Search for "search engine optimization" in Google and you get two large text ads related to this topic at the top of the page ("Premium Sponsorships"), and several smaller ones in the right hand margin ("AdWords").

They are all marked as "sponsored links" and have a different background color. The advertiser pays every time the ad is shown to a viewer, not per click-through as is the case for Overture.

Google has now started delivering regular search results to the large American Internet service provider Earthlink, and is also including paid AdWords! Moreover, the ads are marked as "sponsored results", just the way we like it.

You will also find AdWords and Google results on the Canadian Sympatico portal.

This means that Overture has finally got some competition in the American market as well. Overture was the previous search deliverer to Earthlink, and Overture shares fell as soon as investors found out that it had lost this account to Google.

Note that Google does not deliver paid results to other search engines. Instead they are a part of a package where Google deliver all search results to portals, text ads included.

AdWord advertisers may opt out from showing their ads on other sites than Google.

Europe's Paid Placement Warriors (Search Engine Watch)
PPC scene in Europe (Webmaster World discussion)
Google takes on pay-for-play search (MSNBC)
An Underwhelming Day for Overture Services (The Street)
Overture shares fall as company loses partner (Yahoo!)

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