SEO / SEM Blog by Search Circus

According to the online marketing intelligence group AdGooroo, there were major gains in Internet advertising search during the fourth quarter of 2008 over 2007. The last quarter of 2008 turned out to be the strongest ever for both Google and Microsoft Live Search.

As can be expected, Google led Internet advertising growth with first-page advertiser growth of 58%, with Live Search growing an impressive 42%. Yahoo made Internet advertising gains as well, but the mere 8.8% is indicative of the troubled company’s precarious position among online search’s Big 3.

There was more Internet advertising bad news for Yahoo, as their lead over Microsoft in advertiser share narrowed severely, from 18% in quarter three to only 3% in quarter four. (Yahoo now has 19.4% to Microsoft’s 16.4%).

So what does this mean for Yahoo? Despite the breakdown in talks last May between Microsoft and Yahoo, rumors are still flying in financial circles that the the software giant is still contemplating a takeover of the fledgling Internet company.

In an interview with the Financial Times, Microsoft CEO Steve Ballmer, after denying that the two companies had resumed talks, added that “Together we would have more advertisers….which means we’d have more relevant ads on our page. We’d have higher monetization levels possible in front of us because there would be more people bidding on more key words. Most importantly, Google would have perhaps a real credible competitor sooner.”

It’s that quote that’s keeping people guessing. Will 2009 see the Big 3 of Internet advertising and search become the Big 2?