Overture Services - Company Profile

626-685-5600

74 N. Pasadena Avenue,  3rd Floor
Pasadena, CA 91103

www.overture.com

Business Description 
Overture Services, Inc., a division of Yahoo!, offers pay-for-performance advertising, paid inclusion and algorithmic search services. These services connect advertisers and potential buyers through our network and our affiliates' Websites, networks of Web properties that have integrated Overture's search service into their Web pages. Overture’s search service is comprised of advertiser’s listings, which are screened for relevance and accessed by consumers and businesses through Overture’s affiliates, a network of Web properties that have integrated Overture’s search service into their sites or that direct user traffic to Overture’s own site. In some cases, consumers and businesses access our search listings directly at our site. The search listings are ranked by the advertisers’ bid; the higher the bid, the higher the ranking. Advertisers pay Overture the bid price for clicks on the advertisers’ search listing (also known as a paid introduction, click-through or a paid click). Services include:

• Pay-For-Performance – including Precision Match and Content Match;

• Paid Inclusion and;

• Algorithmic Search.
 

Pay-For-Performance

Precision Match or keyword search prioritizes search results by the amount the advertiser has bid for placement. Advertisers are listed in the search results on our network and also on our affiliates' networks in descending order of their bid, with the highest bidder appearing as the first search listing in the search results. Bids may be expressed either as the amount the advertiser pays each time there is a click on the advertiser's search listing or as the maximum amount the advertiser is willing to pay for a click on the advertiser's search listing. Advertisers pay only when a click-through occurs on the advertiser's search listing. Advertisers may see the bids of other advertisers on their keywords, enabling the advertiser to determine his or her own bid necessary to achieve a desired ranking, which instills competition among advertisers and promotes greater relevance for consumers. Most advertisers utilize self-service tools to open and manage accounts online including tracking, bid management and measurement features.

Content Match allows businesses to place listings on more locations on the Web and drive more traffic to their sites. Content Match displays listings when Internet users are viewing related content on the Yahoo! network or our affiliates' pages. For example, if the user is reading an article about interest rates, he or she could find links on the side of the page for mortgage-related advertisers. Similarly, users who are researching vacation plans may see listings for hotels and rental car agencies.

Paid Inclusion

Paid Inclusion guarantees that our customers' Websites are included and frequently updated in the index that is crawled by the search engine. Customers may pay fees based on sales leads or click-throughs powered by our search services. Customers may also pay a fixed fee that provides inclusion in the Web search index and an automatic 48-hour refresh of the submitted content. Through our paid inclusion programs, customers submit information often not normally available by traditional Web crawling techniques and this information is included in our Web search index. certain of our premium services. This gives them a potential advantage over us in targeting the sale of enhanced services to their user base.
 

INDUSTRY OVERVIEW

Search is a large and growing market. In the United States alone, hundreds of millions of searches each day are conducted on the Internet. We believe a substantial portion of these searches are commercial in nature. Commercial search queries, we believe, are best served by paid search, which we define, generally, as targeted advertising paid per lead. We believe that paid search is the fastest growing segment of Internet search. In our view, improvements in the quality, relevance, breadth and depth of paid listings will likely drive growth of click-throughs on commercial inquiries.

In addition, we also believe that the price per paid introduction that advertisers pay will continue to grow. Relative to alternatives, we believe, a lead on Overture at an average price of $0.35 is less expensive, yet more targeted and measurable than other direct sales methods such as targeted keyword banner ads, direct mail or the yellow pages.

We believe that paid search is a relatively untapped market for many advertisers. Pay-For-Performance search has only been introduced recently and we believe that there are many large advertisers that still have not contributed portions of their marketing budget to Internet advertising and more specifically paid search, but will as the Internet becomes a more acceptable medium for advertising goods and services.

We also believe that our business will continue to experience growth outside of the United States as Internet usage and e-commerce development continue to grow in other countries.

Overture competes directly with other providers of Web search and related search services, including, among others, Ask Jeeves, Inc., Google Inc. and Looksmart, Ltd.

Source: Yahoo! and Overture 10-Ks
 

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