abandons pursuit of Google, lays off 40 workers

By Michael Liedtke

SAN FRANCISCO – In a dramatic about-face, is abandoning its effort to outshine Internet search leader Google Inc. and will instead focus on a narrower market consisting of married women looking for help managing their lives.

As part of the new direction outlined Tuesday, Ask will lay off about 40 employees, or 8 percent of its work force.

With the shift, the Oakland-based company will return to its roots by concentrating on finding answers to basic questions about recipes, hobbies, children’s homework, entertainment and health.

The decision to cater to married women primarily living in the southern and midwestern United States comes after Ask spent years trying to build a better all-purpose search engine than Google.

The quest intensified after Internet conglomerate InterActiveCorp bought Ask and its affiliated Web sites for $2.3 billion in 2005. But remained an also-ran, despite spending tens of millions of dollars on an advertising blitz about dozens of new products that impressed many industry analysts.

Through January, Ask ran the Internet’s fifth largest search engine in the United States with a 4.5 percent market share, according to comScore Media Metrix. Google dominates the industry with a 58.5 percent share.

“No matter what (Ask) did, it just wasn’t enough to get people to leave Google,” said Chris Winfield, who runs a search engine consulting firm, 10e20. “This looks they are raising the white flag.”

Jim Safka, who became Ask’s chief executive two months ago, predicted the retooling will breathe new life into the search engine.

“Everyone at Ask is excited about our clear focus and the trajectory-changing results it will deliver,” he said in a statement.

Forrester Research analyst Charlene Li said Ask’s new strategy could help boost the company’s profits because married women – particularly mothers – dictate many household spending decisions, making them a prime advertising target.

“It’s a smart move,” she said. “I still think Ask has great technology, but it’s just really hard to fight against Google.”

With Ask scaling back, the online search market could winnow to two dominant players, Google and Microsoft Corp. Now third in the market, Microsoft is trying to buy Yahoo Inc., which runs the second largest search engine, for about $40 billion.

Ask’s inability to increase its market share had spurred widespread speculation that Barry Diller, InterActiveCorp’s chief executive, might hire Google to run the search engine’s results to save money. Google already posts text-based ads on Ask and InterActiveCorp’s other Web sites in a five-year deal that Diller expects to generate about $3.5 billion.

New York-based InterActiveCorp plans to break itself into five separate companies later this year. Ask will remain under Diller’s control at InterActiveCorp.

When it first started out in 1996, Ask positioned itself as a search engine that could spit out answers to requests that were posed as natural-language questions instead of being entered as a string of loosely related words.

But the search engine, then known as AskJeeves, frequently misinterpreted requests and produced nonsensical answers that triggered widespread ridicule.

After investing in more sophisticated technology, Ask tried to reposition itself as a cutting-edge alternative to Google and even dropped its cartoonish mascot – a genteel butler named Jeeves – in an effort to be taken more seriously.

Even after adding more bells and whistles, Ask still primarily appealed to women who used the search engine primarily to get simple answers. Women are also a familiar demographic for Safka, who was chief executive of InterActiveCorp’s online dating site,, before taking the reins at Ask.

Li predicted many married women and mothers will be thrilled to have a search engine focusing on their interests. “It’s not so much that these women have simple questions,” she said. “It’s just that they are so busy that they need fast answers.”

Copyright 2008 The Associated Press.