LookSmart announced today that MSN will be dropping LookSmart paid listings and directory listings from its search engine results. The current contract ends on January 15th of 2004 and from that time on LookSmart directory sites will still be listed withing Inktomi search engine results, which MSN currently uses.
With MSN developing its own search engine, this was a move predicted by many within the search marketing industry, however it still delivers a powerful blow to the LookSmart company. The relationship with the MSN Internet division accounted for 65 percent of LookSmart’s listings revenue and all of its licensing revenue in the second quarter ended June 30, according to the search technology company. The company reported revenue of $38.4 million in that quarter.
In an email sent today to LookSmart LookListings (a paid sponsored search link service) customers LookSmart stated the following:
“Your LookListings will also continue to provide traffic from more than 85 other LookSmart partners such as Lycos, About.com, Road Runner, InfoSpace and CNET. We are negotiating with other portals and ISPs for additional distribution of LookListings, and will let you know as new properties are added to our network.
While LookSmart’s paid inclusion traffic will decrease in Q1 2004, we are working to grow our presence in the pay-for-placement market.”
With LookSmart listing its partnership with Lycos and About.com as their top partners, one has to only wonder how long these relationships will last, with Lycos signing a deal to serve Google AdSense Ads on their network and About.com focusing on growing their own paid sponsored listings service, Sprinks.
For Microsoft, this is another step for them developing their own search service. The MSNBot started indexing web sites in July and MSN has taken a serious path to developing a search engine which rivals competitors Google and Yahoo.
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