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These results also support research conducted by Yahoo! in 2005, which revealed that display advertising can have a significant impact on users' search behavior. In this study, the searchers that were exposed to Harrisdirect display ads performed 61 percent more searches on Harrisdirect related keywords. The same group exposed to these display ads also clicked through on Harrisdirect-related terms at a rate 249 percent higher than those who were not shown the display ads, and also clicked on links directed to their website at a rate 139 percent higher than those not exposed.
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Google Shines
What about MSN?
Microsoft's MSN business unit reported a fourth quarter loss of US$190 million, compared to a profit of US$101 a year earlier. Revenue for the quarter was at US$580 million, compared to US$598 million the year before. The loss was caused by MSN heavily investing in search, trying to catch up to market leader Google.Overall, Microsoft reported a 24% decrease in Q4 profits, but a 16% revenue increase for the entire company. These less than stellar figures were sweetened by a generous share buy-back program that was announced at the same time as the results, and by Microsoft's bullish growth outlook.
The Verdict?Yahoo! has definitely fallen out of favor with investors who are worried the company has missed the boat in the community space and is falling further behind Google in the search game - just like MSN certainly doesn't seem to be gaining any search ground just yet. This impression was supported by the fact that Yahoo! announced delays in launching their new advertising software, which was supposed to help the company improve the monetization of searches.While some of Google's underlying trends don't look too exciting either, investors are simply in awe of Google's paid search juggernaut that seems to be generating limitless growth in advertising revenue.
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