Direct Hit

What Made It Different

Direct Hit’s relevancy formula depended on decisions made by millions of browsers. Dubbed “the popularity engine” Direct Hit actually monitored which sites where clicked through on at search portals like Lycos, About, Hotbot and MSN as well as their own DirectHit.com. The more popular the site, the more relevant it was determined to be.

When introduced by founders Garry Culliss and Mike Cassidy, the formula was supposed to make code manipulation and spamming totally ineffective in achieving higher rankings. The decision was left largely in the hands of the users. After a brilliant debut, winning MIT’s $50K Entrepreneurship Contest (at which the founders stunned organizers by giving the prize money to other finalists), DirectHit quickly lined up funding from Mosaic Partner and Draper Fisher Jurvetson, which allowed them to move forward quickly.

Picking the Right Dance Partner

From the beginning, Direct Hit pursued a strategy of partnering with major search portals. In short order, they had added Hotbot, Apple, ICQ, Looksmart, Lycos and MSN to their dance card. In most of these sites, Direct Hit provided anywhere from 3 to 10 search results, usually indicated by the heading “Most Popular”.

While Direct Hit was successful in signing up significant partners, it never managed to establish a strong identity of its on the web. Traffic to its own search service was well below the numbers hit by other major search portals. According to our research, Direct Hit generates only .5% of all search engine traffic.

Where Are They Now?

In January, 2000, Ask Jeeves acquired Direct Hit to provide supplemental search results to their editor written responses. The stock swap deal gave Direct Hit 5.12 million shares in Ask Jeeves, which at the time was worth over $500 million. Like other dot coms, Ask Jeeves share prices have been hammered on the market, currently trading in the $1.40 range, from a one time high of over $275 per share.

Since the acquisition, there has been little news coming from Direct Hit. They are still providing the popularity results to Hotbot and other partners. The renamed Ask Jeeves Popularity search was added to the Ask.com and iWon sites as well as several foreign search engines. The last press release posted on their site was the one detailing the acquisition in January. It seems that Direct Hit has been left to fend for itself as Ask Jeeves struggles with the same disease affecting other search portals, namely lack-of-revenuitis.

Post Mortem

Frankly, I was never that impressed with Direct Hit’s search results. Generally, I found their search results dated and not that relevant. We have noticed that Direct Hit’s index is notoriously slow to update. My suspicion is that other users found the same problems and never adopted Direct Hit as a favored search service. Direct hit was left to live or die on the strength of its partners.

Google

What Made It Different

Like Direct Hit, Google made an auspicious debut in 1998. It was developed by Larry Page and Sergey Brin, two computer Ph.D. candidates from Stanford. Launched as a beta test site, Google gradually increased its loyal user base by a rate of 50% per month, fuelled largely by word of mouth.

In June 1999, Google made headlines in venture capital circles by managing to attract both Sequoia Capital and Kleiner Perkins Caufield & Byers for a $25 Million round of private financing.

Google’s search programs revolved around it’s proprietary PageRank and WebSearch technologies. Google’s approach was to use to monitor the number and quality of links coming into a site as an indication of it’s relevancy. Like Direct Hit, the formula was supposed to deliver much more relevant results and reduce the likelihood of webmasters being able to achieve higher rankings by manipulating code.

Care to Dance?

While strategic partners would play a big part in Google’s development, it wasn’t the number one priority of Page and Brin. They were passionate about their corporate mission, which was to “organize the world's information, making it universally accessible and useful”. Their goal was simply to develop a better search engine. In my opinion, they did just that.

Google’s traffic numbers continued to climb. According to our research, Google is now the number two search portal in the world, generating over 20% of search engine traffic (almost 40% if you include Yahoo results). The size of their index is the largest in the world, with over 1 billion pages indexed and their spider, Googlebot, seems quite efficient at finding and indexing new sites.

In June of 2000, Yahoo turfed Inktomi and replaced them with Google as their default search provider. This was a major coup in search engine circles and made Google even more important as a source of search engine traffic.

Where are They Now?

Google is still a privately held company, so details like share prices and financial performance at not publicly available. Traffic numbers continue to grow and Google is perpetually chosen as a user favorite whenever a study is done on the relative merits of search engines.

Like all search portals, Google is currently seeking a successful revenue model to allow them to keep the bill’s paid. Their introduction of the AdWords advertising program was a step in this direction. I sincerely hope Google finds the magic key to unlocking advertising revenue, as it is the most important search resource on the Web, in my opinion.

Post Mortem

What makes the ultimate difference between Direct Hit and Google? I feel it came down to a better business model and the passion of Google’s founders to provide a better search resource. And, in the end, it comes down to the user. Round up ten of your friends that are regular search engine users. Ask them what their favorite engine is. I’m willing to bet all the Ask Jeeves stocks in my portfolio that at least 4 of them say Google. I’ll double it if one of them says Direct Hit. The people have spoken!