PANAMA - what a bummer of a name for a search engine

The Panama Canal is a geographic paradox - It connects the Pacific Ocean with the Caribbean, that is , it takes ships from the west to east, but if you look at the map of the Panama Canal due to the strange shape of the Panama Isthmus, the canal actually goes from east ( Pacific side) to west ( Caribbean side). That is the left side is the right side and the right side is the wrong side. Just what you need in a search engine!



Search goes on for way to tackle Google

location based services

Yahoo! pays heavy price for Panama setback· Microsoft makes belated play for lucrative market Richard WrayFriday July 21, 2006The Guardian
Panama is not only a central American country through which passes one of the industrial wonders of the 19th century - the canal - it is also the name given by Yahoo! to its enterprise designed to help advertisers navigate one of the industrial wonders of this century, the internet.
This week Yahoo!, one of the pioneers of the internet portal, said its new system, created to strengthen its hand in the battle for a larger slice of the lucrative online search advertising market, will not be ready until next year.
Yahoo!'s shares suffered their biggest one-day fall on fears that the setback would allow Google to increase its dominance among search engines and could provide the window through which third-placed Microsoft might slip.
There is a lot to play for. Search engines on the web have not only opened up the world's wealth of information to anyone with access to a computer and an internet connection, they have also become amazingly lucrative vehicles for the companies behind them.
Allowing firms to advertise their wares alongside relevant search results has been one of the truly revolutionary business models of the so-called new economy - the new business environment that the net is supposed to have created.
Last year the online advertising market in the US, where it is most developed, was worth more than $12.5bn (£6.76bn), up 30% year on year, according to a survey by the Interactive Advertising Bureau and PricewaterhouseCoopers.
In the UK, the market was worth £1.4bn and this year the amount spent by British advertisers online looks likely to outstrip that being spent on national press advertising. Advertising linked to web searches is the largest component of online advertising. In the US it accounted for 41% of the market last year; in Britain it makes up over half the market. It is also the most lucrative area of online advertising.
Google, which makes a whopping 98% of its revenues from search adverts, has profit margins of more than 60%. Yahoo!, which makes use of its position as the web's most visited portal to sell display advertising while also trying to increase its share of search revenues, has margins of just over 40%.
The sheer power of Google's momentum was clear in quarterly figures last night which revealed that its profit had soared by 110% to $721m in the three months to June, compared to a year ago.
The search company's revenue was up 77% at $2.46bn. Google is growing faster outside its home market than it is in America - the company revealed that the proportion of income earned overseas had risen from 39% to 42%.
Google's earnings were released after stock market closed in New York. Its shares had slipped by 3% during the day on fears that it might be afflicted by the slowdown affecting its competitors.
Search is dominated by Google. According to the research firm ComScore, in May Google had a 62% share of global search traffic, up from 55% in the same month the previous year - a rise assisted by its controversial decision to move fully into the Chinese market.
Yahoo! was firmly in second place with just over 20%, down from 22%, while Microsoft languished in third at under 9%.
In the core US market, Google, according to ComScore, increased its share of monthly online searches in June this year to 44.7%, from 36.5% during June 2005.
From all these statistics one thing is clear: Google dominates. Yahoo! and Microsoft will have to increase both their share of search and the revenues they make from allowing advertisers access to that search audience, to stop the behemoth from Mountain View, California, taking over.
Internet users do not seem swayed by the effectiveness of online search engines. Nate Elliott, an analyst at Jupiter Research, suggests that this is because branding is the important factor. "It is quite ironic that the actual quality of the search itself does not matter. Obviously, if a search request brings back no relevant results people would stop using it, but all the search engines are quite similar."
To increase audience share, search engines have become interested in partnerships with online firms that have a strong brand awareness. In May, Yahoo! linked up with online auction site eBay, one of the web's largest e-commerce players, in a partnership that includes using Yahoo!'s search facility on the eBay site.
That deal came after Google beat Microsoft to a link-up with AOL, paying an over-the-odds $1bn for a 5% stake in the company, giving it the right to keep its search engine at the heart of the Time Warner online property. Google is keen to retain its position within AOL and the company is rumoured to have agreed to hand back to AOL 90% of the advertising revenues it gets from searches carried out through the portal.
A deal with AOL was Microsoft's chance to get back in the game, Mr Elliott reckons. "The AOL deal was their shot and they missed it. There are only a handful of partnerships that matter, with the portals that do not have their own search functions and AOL was the largest of those."
Microsoft is now expected to roll its MSN search facility into its new Windows Vista operating system but there are doubts about whether that will help to boost its market share.
To meet the second challenge - of finding ways to increase revenues generated by paid-for searches - Microsoft has already developed a new tool. This is called AdCenter and it is designed to compete with Google's popular AdWords, which allows advertisers to create adverts and choose search keywords so that when those subjects are searched for the advertiser's campaign appears on the screen.
Microsoft has yet to aggressively market AdCenter to the advertising community and some on Wall Street believe that the delay in the roll-out of Yahoo!'s new advertising software - Panama - could present the software giant with just the window of opportunity it needs.
For Yahoo!, the delay in the roll-out of Panama has been a severe blow.
"From a search query standpoint, Yahoo! is maintaining share," said Jefferies analyst Youssef Squali. "But from a revenue perspective, they have certainly lost quite a large share to Google, and that is why Panama was so important and why Panama continues to be important."