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May 26, 2006

Big Boys Play Together: Google and Dell, Yahoo and eBay



By Mae Kowalke
TMCnet Associate Editor


Two partnerships between technology giants this week exemplify how a competitive marketplace is driving even the biggest players to team up in order to win.
 
On Thursday, a deal between Google and Dell—which has been in negotiations since February—was finalized.
 
According to an Associated Press report, Dell (News - Alert) will soon begin selling computers with Google (News - Alert) Desktop and Toolbar software pre-installed, and will add Google Search to the side pane of Internet Explorer 6.
 
Dell and Google also will be offering a co-branded homepage, set as the default on new Dell computers, AP reports.

Financial terms of the deal were not disclosed, but in another report the AP said Google may have considered paying as much as $1 billion for a three-year deal.
 
This kind of move by Google, which continues to increase its market share with a variety of offerings including click-to-play video ads and a China-based mobile search engine, is not going unchallenged by other big players.
 
Also on Thursday, AP reported a deal between search engine company Yahoo and online auctioneer eBay, in which Yahoo gains exclusive rights to graphical ads on eBay’s website, and Yahoo’s brand and search engine will become part of the eBay toolbar.
 
The deal also includes provisions for the PayPal online payment service—owned by eBay—to become the preferred method for Yahoo site users to pay for purchases they make on yahoo.com. (The site includes shopping, auction and subscription services sections.)
 
And that’s not all. The two companies are also examining ways to boost each other’s advertising market share through eBay’s Internet phone service, Skype.

Most of the joint services won’t be available until next year, AP reports.

These two deals bring to light another point: the companies in question are no longer specializing in one segment of the high-tech market, but have branched out in many directions.
 
Google software on Dell laptops puts a search engine company in competition with Microsoft. Yahoo branding becoming part of Skype (News - Alert) makes that search engine an indirect competitor of Vonage (News - Alert) and other VoIP providers.
 
It just got a little bit harder to keep track of who owns whom anymore. Stay tuned for more interwoven threads!
 
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Mae Kowalke previously wrote for Cleveland Magazine in Ohio and The Burlington Free Press in Vermont. To see more of her articles, please visit Mae Kowalke’s columnist page.
 
 

 

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