Google moves in with Yahoo Japan on search technology

Yahoo Japan Corp is partly owned by cell phone and internet service provider Softbank Corp (40 per cent) and US counterpart Yahoo Inc (35 per cent). Yahoo Inc currently operates under Microsoft's search technology in all countries, except Japan.

Yahoo Japan runs on an internally developed system. The switch, which will eventually also incorporate Google's online advertising platform, is expected to be completed at the end of the year.

Among search portals in Japan, Yahoo dominates the number one spot with a 57 per cent market share compared to Google's 38 per cent.The new arrangement means Google will account for an approximate 80 per cent share of the Japanese search service market.

Masahiro Inoue, president at Yahoo Japan, said Microsoft's search technology is not compatible in many areas and especially in terms of Japanese language citing. This is also partly because of Microsoft's move to the Bing platform.

Inoue adds that the Google tie up will post no problems with the Fair Trade Commission, even if this appears to near a monopoly.

Apart from back-end changes, things will remain the same for Yahoo Japan as it retains the Yahoo logo and user experience. Placing advertisements on Yahoo Japan will not show on Google, and vice versa.

The move might not come as a total surprise for the search industry. Google previously supported Yahoo Japan for three years from 2001. In 2004 Yahoo Japan migrated to the US developed Yahoo system in 2004.

Antony Yiu, managing director of iProspect Hong Kong and regional search director for North Asia, commented that Google is still behind in Greater China and North Asia. Apart from Hong Kong and Japan, Google has a long way to catch up with Chinese player Baidu, Taiwan's Yahoo and Korea's Naver.

"Let's see how the game plays out in China. Yahoo China is also not owned by Yahoo Inc. It will be interesting if Alibaba, which own Yahoo China, decides to strike a deal with another search partner or develop its own search engine," said Yiu.

"If that's the case, it means Yahoo is simply just a brand name with no consistent platform across all Yahoo properties around the globe," he added.