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InterActiveCorp Buys Ask Jeeves for $1.9 Billion

InterActiveCorp Buys Ask Jeeves for $1.9 Billion

InterActiveCorp Buying Ask Jeeves for $1.9 Billion

The New York Times is reporting that Ask Jeeves is to be acquired by IAC for the equivalent of US$1.9 billion in stock. The deal, if completed, makes a certain amount of sense for both companies. Ask Jeeves has good technology but has been struggling to differentiate itself and grab more search market share.

IAC has valuable properties—and owns Jeeves local content partner Citysearch—but has struggled to find “synergies” (read: cross promotional opportunities) between them and maximize their value. This will give IAC first-rate search technology as well as a blogging platform (Jeeves very recently acquired Bloglines). It will provide Jeeves with a great many more content assets, as well as deeper pockets.

Together the combined properties represent a potentially formidable ad network. Jeeves had relied primarily on Google for ad revenues, although the company had created AJInteractive out of a number of properties purchased earlier this year (The MaxOnline Network, Excite and iWon).

For both Jeeves and IAC it provides something of an answer to a gnawing question about each company: What are they going to do?

Also today, Yahoo! announced that it was buying the social networking/photo-sharing site Flickr, which no doubt will become part of the core of Yahoo!’s new mega-community initiative, Yahoo! 360.

If deals, like celebrity deaths, come in threes, one has to wonder: What’s next?

Greg Sterling is managing editor of The Kelsey Group. He also leads The Kelsey Group’s the Interactive Local Media program, focusing on local search. Greg came to The Kelsey Group from TechTV’s “Working the Web,” the first national television show dedicated to e-business and the Internet.

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