Ask Jeeves Completes Search Acquisition

By Matthew Hicks  |  Posted 2004-05-07 Print this article Print

The company's $501 million purchase of Interactive Search Holdings doubles its market share as it gains Web properties such as Excite and iWon.

Ask Jeeves Inc. on Friday completed an acquisition that is poised to double its market share in the increasingly competitive Web search market. The Emeryville, Calif., search company said it has closed its $501 million purchase of Interactive Search Holdings Inc., a privately held company whose Web properties include Excite and iWon.
The acquisition makes Ask Jeeves the seventh-largest Web property based on unique users and gives it a reach to about 25 percent of U.S. Web searchers, the company said.
Ask Jeeves expansion comes in the midst of intensifying competition in the Web search market. Last week, Google Inc. filed for a public offering that could raise $2.7 billion and help it fend off competitors. Yahoo Inc. earlier this year replaced Google with its own search results, and Microsoft Corp.s MSN group has said it plans to compete by launching its own search technology later this year. When Ask Jeeves announced the deal in March, it said that Interactive Search Holdings accounted for about 700 million searches in the fourth quarter of 2003, compared with 680 million searches for Ask Jeeves. Unlike Ask Jeeves, which owns the Teoma search-engine technology, Interactive Search Holdings had focused on offering search and portal tools on top of search-engine results from such Ask Jeeves competitors as Google, Yahoo and LookSmart Ltd. Ask Jeeves has yet to detail how it plans to integrate the new properties with its own sites and search technology, but it has said that Interactive Search holdings will be a subsidiary and remain based in Irvington, N.Y. Other Web properties Ask Jeeves gained in the acquisition are My Search, My Way, My Web Search and the MaxOnline advertising service. "We now have substantially more traffic and advertising inventory, which we believe will increase our value to advertisers and partners," Ask Jeeves CEO Steve Berkowitz said in a statement Friday. Click here to read more about Ask Jeeves recent changes to its paid inclusion search programs. As part of the acquisition, Ask Jeeves issued 9.3 million shares of common stock and options and paid about $144 million in cash. The company has scheduled a conference call Wednesday with financial analysts to discuss the acquisition. Check out eWEEK.coms Enterprise Applications Center at for the latest news, reviews, analysis and opinion about productivity and business solutions. Be sure to add our enterprise applications news feed to your RSS newsreader or My Yahoo page:  
Matthew Hicks As an online reporter for, Matt Hicks covers the fast-changing developments in Internet technologies. His coverage includes the growing field of Web conferencing software and services. With eight years as a business and technology journalist, Matt has gained insight into the market strategies of IT vendors as well as the needs of enterprise IT managers. He joined Ziff Davis in 1999 as a staff writer for the former Strategies section of eWEEK, where he wrote in-depth features about corporate strategies for e-business and enterprise software. In 2002, he moved to the News department at the magazine as a senior writer specializing in coverage of database software and enterprise networking. Later that year Matt started a yearlong fellowship in Washington, DC, after being awarded an American Political Science Association Congressional Fellowship for Journalist. As a fellow, he spent nine months working on policy issues, including technology policy, in for a Member of the U.S. House of Representatives. He rejoined Ziff Davis in August 2003 as a reporter dedicated to online coverage for Along with Web conferencing, he follows search engines, Web browsers, speech technology and the Internet domain-naming system.

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