Rumor has it that Marissa Mayer, chief executive of Yahoo!, has been talking with Sheryl Sandberg, Facebook’s chief operating officer, about how the two companies can work more closely together, particularly on web search. Sources say that the two former Google executives may be working to create a search engine partnership that could be a serious competitor to Google, if that’s even possible.
Upon hearing this, my first question was “why?” Facebook already has a search partnership with Bing and it wasn’t too long ago when Mark Zuckerberg said, “I couldn’t think of anyone better to be working with to build the next generation of search.”
Zuckerberg stated that just two years ago, and while I understand that people do change their minds, I am still unsure about what Yahoo brings to the table that Facebook isn’t already getting with Bing. Bing gets five million more unique monthly visitors than Yahoo and is the next best thing to Google. At this point, Bing has far more search talent and much better search technology than Yahoo. The search engine also has more useful web search experience than Yahoo, considering that Yahoo has outsourced web search to Bing since 2010.
If anything, it seems that Yahoo would be the one benefitting more from a partnership like this. The company has not showed much stability in the past few years, as its financial performance and stock price have been steadily declining since rejecting a $47.5 billion takeover offer from Microsoft in 2008. Yahoo has also hired and fired a considerable amount of chief executives since then. When Mayer was hired in July, she became the company’s fifth CEO in five years. At the time of her hire, it took Google a little more than a month to make as much money as Yahoo does in a year.
A partnership with Facebook would allow Yahoo to piggyback on the social network’s brand cachet to help it attract and recruit some high-level computer programmers, which has been a major problem for Yahoo in the past two years. Who wouldn’t want to technically work for two big internet powerhouses at the same time?
Mark Zuckerberg seems to believe that Facebook is already a search powerhouse, despite the fact that it’s not a search engine. According to him, the social network is compiling over a billion searches a day without even trying. With that said, keep in mind that most searches (estimated to be 90% or more) on Facebook continue to be Facebook users looking for other Facebook users.
If Facebook created a partnership with Yahoo, it could allow the social network to take a step forward to target advertising more efficiently. In turn, Yahoo may be able to receive more visitors because Facebook’s one billion users and Yahoo’s 160 million monthly unique visitors would be combined.
At the end of the day, a social network is very different than web search. If Facebook seriously wants to go up against Google in search, it would have to make a serious effort, a major engineering investment, and recruit enough key talent. So far, aside from these rumored conversations between Mayer and Sandberg, there are no signs that any of this is happening. On Monday Facebook issued a statement that said, “People expect a better search experience on Facebook. We are working on improvements to better meet those expectations but are not in talks to enter into a new search partnership.” This doesn’t necessarily mean that Facebook and Yahoo aren’t discussing the idea though. For now we’ll just have to stay tuned to see what happens.