(WEB HOST INDUSTRY REVIEW) — In order to snare a regional online advertising market that may increase as much as 40 percent this year, web search provider Yahoo! (www.yahoo.com) has signed a definitive agreement to acquire Arabic-language Internet portal Maktoob.com.
According to Yahoo’s announcement this week, Internet users in the region will benefit from the combination of Yahoo’s products and services with Maktoob’s compelling local content, which currently reaches a third of the online Arab world. The acquisition will also extend Yahoo’s current offerings by adding capabilities to deliver relevant Arabic-language content and services, as well as Arabic versions of Yahoo Messenger and Yahoo Mail.
“This acquisition will accelerate Yahoo’s strategy of expanding in high-growth emerging markets where we believe Yahoo has unparalleled opportunity to become the destination of choice for consumers,” Yahoo chief executive officer Carol Bartz said in a statement. “Access to information and communications tools can positively impact people’s lives in many ways, and with the acquisition of Maktoob.com and our investment in the region, the Arab world will soon get a Yahoo experience in Arabic with relevant local language content, programming and services.”
Internet usage in the Middle East has grown more than tenfold since 2000, however, most markets are still in the early stages of development. There are more than 320 million Arabic speakers worldwide, yet less than one percent of all online content is in Arabic, according to the World Bank.
Yahoo and Maktoob.com’s combined audience and platform promises to give advertisers access the reach and sophisticated targeting capabilities they need to effectively engage with the region’s online consumers. According to Madar Research (www.madarresearch.com), online advertising spending is expected to grow by 35 to 40 percent this year in the region.
This acquisition could be thought as a part of Yahoo’s recovery following a $47 billion acquisition negotiation failure with Microsoft last year, which saw its market value fall by more than $20 billion. Added to Yahoo!’s troubles were a failed partnership with AOL (www.aol.com) and an advertising revenue-sharing deal Google (www.google.com), which dissolved in late 2008, which factored into co-founder Jerry Yang’s decision to resign as CEO in favor of experienced technology executive Carol Bartz.
In an effort to wrestle search engine market share from Google, Yahoo! and Microsoft (www.microsoft.com) entered into a web search partnership agreement last month in which Microsoft will power Yahoo! search and Yahoo! will handle worldwide sales for both companies’ premium search advertisers.
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