Will mobile search save Yahoo!

Posted Jun 17th 2008 9:00AM by Douglas McIntyre
Filed under: Forecasts, Deals, Competitive Strategy, Google (GOOG), Microsoft (MSFT), Yahoo! (YHOO)

Overnight, Yahoo! (NASDAQ: YHOO) signed several cell carrier deals in Asia that will put its mobile search onto a large number of new phones. According to the company, it now reaches 600 million handset customers worldwide.

Maybe mobile search will be a big market, but maybe it won't. Reuters writes that "the mobile advertising market is expected to rise to $16.2 billion in 2011 up from $1.5 billion in 2006."

Yahoo! may want to avoid counting its chickens too early. Despite the firm's upbeat tone, Google (NASDAQ: GOOG) and Microsoft (NASDAQ: MSFT) are having success getting into the same market. In China, where there are well over 300 million handsets in use, Baidu (NASDAQ: BIDU), the county's largest search company, does not want to give up market share to US-based companies.

If Yahoo! gets 20% of the market in 2011, it would pick up $3 billion in additional revenue. Is that a nice chunk of change? Yes, but that is a long time for Yahoo! shareholders to wait.

Douglas A. McIntyre is an editor at 247wallst.com.

Tags: BIDU, GOOG, inthenews, MSFT, YHOO