Tech Crunch reports that Google (GOOG) has signed an exclusive deal to provide search services to social network site Friendster. Of course, it will also sell the ads that will appear with search results. Google has a similar deal with MySpace, which cost it about $900 million in revenue guarantees, but the News Corp site is the largest online social network in the world.
Yet another social network site, Facebook, uses Microsoft (MSFT) search.
Depending on which research firm is reporting figures, Google has 45% to 50% of the search market, and Microsoft has 10%, on a good day.
Microsoft claims search technology is essential to the future of its online business including Microsoft Live. As the company delivers more of its software to users over the internet search capability becomes a critical part of the package. Using the Microsoft OS and Google search running on the Microsoft Internet Explorer is not exactly what the big software company had in mind.
Microsoft is falling further behind in search. The new Yahoo! (YHOO) Panama product may also take share from Microsoft. And that leaves Redmond with the one commodity it has in abundance–cash. If the company is not willing to pay more than Google for the distribution of its native search technology, it will continue to fall further behind by the day.
And, right now, it is much, much further behind.
Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.
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