April 7, 1998 1:50 PM PDT
AltaVista embarks on TheTrip.com
Under the terms of the five-year deal, TheTrip.com will pay AltaVista $15 million and will be the exclusive provider of travel services and content for the search site, which is owned by Digital Equipment.
AltaVista is relatively new to the portal battle, though it plans to add services and expand its content to draw visitors, according to Don Bradley, a spokesman for AltaVista.
Patrick Keane, senior analyst with Jupiter Communications, said it seems "plausible" that Digital could be fattening up AltaVista for the kill--that is, a lucrative sale to another company--in light of the proposed merger between Digital and Compaq.
But it also could be just "leveraging [AltaVista's] traffic and using it to make the site a portal," Keane noted, adding that AltaVista's traffic has put it in the top ten of several measurements of sites' popularity.
Exclusive, money-drenched deals are common lately among the search sites, which are competing for eyeballs in the dog-eat-dog portal market. The major portal players such as Yahoo, Excite, and America Online continually add features such as free email, stock quotes, and paging services to try to attract loyal visitors and the ad dollars that accompany them.
Some are even getting into more personal areas. AOL announced it would offer discounted health insurance to its members, beginning in October. Yahoo jumped on board yesterday, launching an Insurance Center on its site that features quotes and estimates on automobile, home, life, and other types of insurance.
AltaVista, the portal battle's late bloomer, added free email only last month.
"By adding content, our goal is to add users--especially the newer users," Bradley said, noting that AltaVista recently struck a deal to get health-related content from IntelliHealth, which is a joint venture between Aetna U.S. Healthcare and Johns Hopkins University. AltaVista also powers searches on the IntelliHealth site.
AltaVista is planning to add finance content and news, Bradley said.
He said the difference between AltaVista's content services and those of its competitors lies in the way the information is delivered.
"What we're adding to our site is a 'travel zone,' instead of a channel. We get the information to you in a better, faster, more entertaining way," he said. Content on the travel zone will be updated so that users can find seasonal, category-specific information on places and events.
But speculation abounds about the timing of AltaVista's new features. Search companies are enjoying high valuation on Wall Street lately; most notably, Yahoo's stock broke the $100-per-share mark last week. With the Compaq-Digital merger nearing regulatory approval, it would make sense for Digital to dress up AltaVista as a solid player in the portal market to make it a valuable commodity for a sale.
Bradley declined to comment on Digital's plans for AltaVista.
Keane at Jupiter noted AltaVista's late entrance into the portal market, but said the site's impressive traffic numbers "should not be marginalized," and AltaVista could be making these deals now simply to leverage its numbers. Bradley said AltaVista gets 20 million unique visitors per month.
Keane predicted AltaVista would ink more content and e-commerce deals, no matter what Digital's plans for it. He said he expects it to join its search competitors in book and CD alliances, for example.