Microsoft Reaffirms Lack of Commitment to Yahoo
Jerry Yang and Co. say Microsoft (MSFT) was never committed to a whole-company acquisition of Yahoo (YHOO). But if that’s the case, why is it that Microsoft seems entirely committed to a whole-company acquisition of another search company–Powerset?
This afternoon, Microsoft said it will acquire the search start-up for a sum believed to be more than $100 million.
Coming as it does in the aftermath of Microsoft’s failed effort to buy Yahoo, the acquisition is an interesting one. Powerset is no Yahoo. That said, it’s in some ways better.
Powerset specializes in so-called “natural language” search, which is meant to understand the intent and meaning behind the words in search queries–so that, for example, a search engine could understand the difference between a search for “yahoo” the exclamation, and “Yahoo” the search company Microsoft didn’t buy. Powerset searches the Web–well, at this point, just Wikipedia–semantically. And that’s a handy skill to have when your competing with Google (GOOG), which isn’t yet able to search the Web in that way.
Said Harvard Business School professor Andrei Hagiu, “Microsoft’s acquisition of Powerset makes perfect sense and is probably the best shot at a disruptive technology that might allow it to leapfrog Google.”
