Yahoo hopes new features will help it catch Google

SAN FRANCISCO — Yahoo unveiled enhancements to its Internet-search service Tuesday in an attempt to woo consumers away from market leader Google while staying a step ahead of Microsoft.

The move follows a search revamp unveiled by Microsoft last week, which featured the addition of similar new features. While Microsoft has remained in third place behind Google in search-market share, Yahoo has consistently placed second behind Google.

Both Yahoo and Microsoft are desperately seeking a way to blunt Google's increasing dominance of the market, which can provide significant revenue from accompanying text-based advertisements.

One of the new Yahoo search features is a drop-down menu that includes suggested and related information for deeper exploration of search topics.

In a posting on a Yahoo company blog, company executive Tim Mayer said the new search enhancements are designed to lend extra assistance to users only when they ask for it, which he said should distinguish Yahoo search from other services that offer help automatically.

Other new functions include the integration of multimedia results such as video, audio and photos, including pictures from Yahoo's Flickr photo-sharing site. The combination of such media, along with basic Web links and information, is known in the search industry as "universal search."

Google, Microsoft and other companies have also incorporated universal-search capabilities as part of efforts to cut down on the length of time it takes a consumer to find answers.

Jeremy Kaplan, executive editor at PC Magazine, characterized Yahoo's actions as a "me too" move since Google and other search engines have already made similar changes.

In a statement Tuesday, Yahoo cited results from a Harris Interactive study that said while 99 percent of online adults use a search engine to find information on the Internet, only 15 percent find what they are looking for on the first try, and most searches need to be performed three or four times.

Investors' immediate response to Yahoo's search initiative was underwhelming. Yahoo shares fell slightly to close at $26.95, while Google added 0.2 percent to $584.39. Microsoft shares dropped slightly to $29.70.

Cowen analyst Jim Friedland said in a note released to clients shortly after Yahoo's announcement that "the company is following faster, not innovating."

Friedland noted that many of the new features on Yahoo's service are already available from Google.

"We continue to believe that Google will achieve a global-search market share of at least 90 percent over time, marginalizing Yahoo and Microsoft," he said.