Ask.com lays off 8% of its workforce in makeover

Ask.com lays off 8% of its workforce in makeover
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First Published: Wed, Mar 05 2008. 02 22 PM IST
Updated: Wed, Mar 05 2008. 02 22 PM IST
By Michael Liedtke
San Francisco: In a dramatic about-face, Ask.com is abandoning its effort to outshine Internet search leader Google Inc. and will instead focus on a narrower market consisting of married women looking for help managing their lives.
As part of the new direction, Ask will lay off about 40 employees, or 8% of its work force. With the shift, the Oakland, California-based company will return to its roots by concentrating on finding answers to basic questions about recipes, hobbies, children’s homework, entertainment and health.
The decision to cater to married women primarily living in southern and midwestern United States comes after Ask spent years trying to build a better all-purpose search engine than Google.
The quest intensified after Internet conglomerate InterActiveCorp bought Ask and its affiliated Web sites for $2.3 billion in 2005. But Ask.com remained an also-ran, despite spending tens of millions of dollars on an advertising blitz about dozens of new products that impressed many industry analysts.
Through January, Ask ran the Internet’s fifth largest search engine in the United States with a 4.5% market share, according to comScore Media Metrix. Google dominates the industry with a 58.5% share.
“No matter what (Ask) did, it just wasn’t enough to get people to leave Google,” said Chris Winfield, who runs a search engine consulting firm, 10e20. “This looks they are raising the white flag.”
Jim Safka, who became Ask’s chief executive two months ago, predicted the retooling will breathe new life into the search engine. “Everyone at Ask is excited about our clear focus and the trajectory-changing results it will deliver,” he said in a statement.
Forrester Research analyst Charlene Li said Ask’s new strategy could help boost the company’s profits because married women, particularly mothers dictate many household spending decisions, making them a prime advertising target.
“It’s a smart move,” she said. “I still think Ask has great technology, but it’s just really hard to fight against Google.”
With Ask scaling back, the online search market could winnow to two dominant players, Google and Microsoft Corp. Now third in the market, Microsoft is trying to buy Yahoo Inc., which runs the second largest search engine, for about$40 billion.
Ask’s inability to increase its market share had spurred widespread speculation that Barry Diller, InterActiveCorp’s chief executive, might hire Google to run the search engine’s results to save money. Google already posts text-based ads on Ask and InterActiveCorp’s other Web sites in a five-year deal that Diller expects to generate about $3.5 billion.
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First Published: Wed, Mar 05 2008. 02 22 PM IST
More Topics: Jeeves.com | Ask.com | J im Safka | Google | Technology |