Overture pulls a FAST search

By Steve Malone

Posted on 26 Feb 2003 at 10:17

Overture Services, the world's leading provider of pay-per-click search on the Internet has bought the search divisions of Fast Search & Transfer (FAST) for $70 million in cash. The deal also includes bonus payments of up to $30 million over three years. The deal is expected to close by April.

The move follows Overture's recent acquisition of AltaVista for $140 million and poised to challenge Google as the Internet's leading search destination.

Following Yahoo's acquisition of Inktomi for $235 million at the end of last year, it further consolidates the development of a `Big Three` in search engine technologies and leaves Google as the last remaining independent search engine.

Overture has laid out its strategy as being able to provide potential customers with three types of search service. There is Overture's traditional business in providing paid inclusion programs (in exchange for a payment, a search engine will guarantee to list pages from a web site) and there is paid placement (guaranteeing top listing, the more you pay the better your ranking). Finally, Overture with its new acquisitions will be able to offer 'algorithmic search', which means that Overturn customers can pay to have their site crawled regularly and their listings kept up to date.

More importantly, it consolidates Overture's own search capability at a time when it saw its major rivals snapping up search engines. Overture felt it had to buy up AltaVista and FAST before someone else did.

Overture says it will use both the FAST and AltaVista sites to advance the company's product development process. The company will use FAST's technology showcase site, AlltheWeb.com, to test and experiment with advanced approaches in search. At the same time, the company will use the AltaVista.com site, which operates on a larger scale, to refine implementations for new products and improve presentation to consumers.

The company expects to have standardised sales and technology teams by the end of the year but has warned, however, that the acquisitions will not be painless and expects `to realise certain cost synergies (including) a reduction of traffic acquisition costs, elimination of certain redundant positions, consolidation of serving locations, rationalization of hardware and refinement of architecture to support the next generation of search`. In short, the company expects to shed staff and save money through rationalisation of the various units.