"The search wars are over, and Google has won."

I made a similar comment when blogging about the MicroHoo? merger back in Feb. ("The search engine game is over. GOOGLE WON.")

But it is now OFFICIAL, because it is printed in Wired Magazine. See here.

I had postulated that Google and Microsoft are in this fight over Yahoo! for the future of "Consumer Computing Services".

In this Wired article however, they have a different theory:

"Microsoft's Bid for Yahoo Is All About Big-Budget Brand Advertising" was the title of the article.
"But the good news for all of Google's rivals is that online advertising is about much more than search. The new battleground is display — the kind of graphics-intensive spots that were left for dead after the Internet bust — and the emerging category of video."

Great stuff. While I still think on the tech side they are going after those services, advertising is a major source of revenue. For any media owner (TV, PayTV, Radio, yahoo, etc), there are two main sources of revenue: Subscription and Advertising. Consumer Computing Services follows the Subscription revenue model whereas this article suggests that adverting - brand advertising in particular - will be the main source.

"... ultimately it comes down to advertising. Web advertising is in the midst of a metamorphosis. As television implodes, marketing chiefs are turning to the Net to create branding initiatives. They know you can't build a brand with little text ads that pop up next to search results."

I would have to agree with that, but search engines and content networks are more targeted rather than shotgun advertising approach.

"Web advertising, which passed $20 billion last year in the US, is expected to surpass $60 billion in four years, and display and video ads will account for more than a third of the total."

"mmmm... money" - says Homer.

So what would MicroHoo! look like in the brand advertising space?

"What Yahoo brings to the table is numbers: It is the world's most popular Internet publisher, delivering Web pages to nearly 140 million people a month in the US alone. Yahoo also delivers ads to a vast network of independent sites, increasing its advertising reach to 85 percent of US Internet users, according to comScore. Microsoft reaches 56 percent of the US Internet population through MSN and Windows Live, but it still lacks credibility with Madison Avenue. Put it together with Yahoo, however, and you have a scale that even Google can't match."

I don't disagree, but I can't help but refer back to the classic advertising problem of "Half of all my advertising is wasted. I just don’t know which half!" You spend money on brand advertising but you don't know what works because you can't always track people to the ultimate interaction with a brand.

But online brand advertising is soooo much more measurable than offline advertising --- with the right analytics tool - like Omniture. So the shift in ad dollars from offline to online will accelerate as the Google and MicroHoos get their platforms into shape.