MSN Ends Looksmart Relationship

• Oct. 6, 2003

In what may prove to be the end of the one true independent PPC supplier, Looksmart announced today that MSN will no longer be carrying its paid listings after January 15^th 2003.

We brought you news that MSN was considering dropping Looksmart. Now it appears that Looksmart has confirmed the rumor. This is unfortunate, because Looksmart was shaping up to be a very competitive player in the PPC market. They recently released a new PPC model which looked to be a very good alternative to Google AdWords and Overture PPC skyrocketing prices.

On the plus side, if any major player were looking at scooping up a PPC engine for a song, Looksmart would be a good buy. Perhaps that is what MSN is considering. It makes financial sense (maybe not moral sense) to devalue a supplier to the point that you can pick them up for a fraction of their actual value, which is where Looksmart's share price is going to be in the next few days to few weeks.

This is really unfortunate for many advertisers as well. While Overture's average price per click keeps rising, Looksmart was offering a way to lower an advertisers overall cost per click, and perhaps even drive more qualified traffic to the site. Plus it was an inexpensive way to get good rankings in MSN. Now it looks like the only way into MSN will be an Inktomi paid submission, or an Overture paid listing.

This in itself is surprising because MSN's main competitor is Yahoo! And we all know that Yahoo! owns Overture and Inktomi.

One thing is for sure - if Looksmart doesn't start monetizing on it's PPC in a hurry, by signing large well known partners, it will likely go the way of the AltaVista's and Snap's of the web world.

Rob Sullivan
Production Supervisor
Searchengineposition.com
Search Engine Positioning
specialists