Yahoo! Buys Whereonearth to Boost Local Search Offering

Earlier this week, Yahoo! announced that it had purchased Whereonearth, a company that specializes in location-based Internet services. Yahoo! hopes to use the Whereonearth technology to improve the performance of their mobile and local search services. Local search, while still in its infancy has become a highly competitive market in the last year. Google, Yahoo!, Amazon's A9 and Ask Jeeves are all pushing their local search services hard.

"Whereonearth’s very talented team of software engineers and Geographic Information Systems (GIS) experts have worked hard to develop sophisticated technology that contains a unique combination of global data and software algorithms that make local search possible" said Bassel Ojjeh, Vice President, Strategic Data Solutions, Yahoo!. "Together, we’ll be able to provide the most geo-relevant information across all of Yahoo!’s products and services.

With 80-90% of all purchases taking place within a ten mile radius of an individual's home, the emphasis on local search makes sense. Studies of Internet users show that only about 8% of searchers will end up making an online purchase. The other 92% are simply researching the products that they are going to end up buying in a brick and mortar store. That means that it's essential for small and local businesses to get themselves in front of searchers that are looking to shop at a physical location.

Since Whereonearth's database already covers more than 90% of Europe, Asia, North America and South America, and the company already had a working relationship with Yahoo!, the purchase makes perfect sense.

Whereonearth's localized search products will benefit Yahoo! beyond simple business listings. It will also be able to power localized content like job listings, on-line classified ads, personals and even travel destination information. The technology could also be used to bolster geographic targeting for Yahoo! advertisers.

Geographical targeting is one of the features being touted in MSN's new adCenter program. If it works well, Yahoo! and Google will be forced to significantly improve their own geotargeting abilities. This purchase could signal Yahoo!'s first step in that direction.

Whereonearth also touts it's wifi location based services on its web site, which may mean that Yahoo! is also looking to go head to head with Google in that realm. (Google is already working with a company called Feeva that has similar offerings.) What that basically means is that users on a free wifi connection could easily be served highly targeted local ads while they surf. That's part of what all of fuss over Google's possible plans for expansive free wifi services is all about.

Only time will tell how this new technology will be put to use by Yahoo!, but the non-stop gobbling up of smaller companies by the big three search engines makes it clear that all of these players are in the game. While the ultimate search engine winner remains to be seen, search engine users are going to enjoy plenty of handy new tools courtesy of the fierce competition.

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