November 5, 1999 12:15 PM PST

Search rivals see AltaVista straying from its roots

AltaVista's rivals are smelling blood as the company moves to transform itself from a plain vanilla search engine to a Web media destination.

Just days after the company announced a major overhaul to compete with full-service Web portals such as Yahoo, search engine Northern Light launched a national advertising blitz to try to convert longtime AltaVista users to its service.

The one-day campaign, which hit major daily newspapers across the country, doesn't come close to matching the $120 million marketing budget slated for AltaVista's makeover. But the guerrilla attack highlights a niche marketing opportunity for AltaVista's competitors as the company seeks to become something more than the search engine of choice among Internet cognoscenti.

AltaVista said it views the Northern Light campaign as a compliment.

"They're taking shots at the leader, and it's flattering," said David Emanuel, an AltaVista spokesman.

Still, Northern Light's campaign comes at a time when AltaVista may be particularly vulnerable in the high-end search market. Last week the company confirmed that it has temporarily stopped updating its search directory. Most AltaVista users have not been able to post new URLs in the search directory since early September, pending a system upgrade.

Northern Light's campaign also comes less than two weeks after AltaVista redesigned its site in a bid to transform the company into a hub for Web content, commerce, and services.

The company has been known primarily for its potent search technology, which was developed by Digital Equipment Corporation engineers. In contrast to other search companies, however, AltaVista has been slow to trade on its reputation as a solid search engine to become a general-interest destination.

That changed when Internet investment firm CMGI acquired AltaVista from Compaq Computer for $2 billion earlier this year and began a full-steam effort to transform the search site into a major Web portal.

The strategy is in line with that of other Web navigation sites, which have abandoned the model of offering a single service. Companies such as Yahoo, Excite, and Lycos have all added a host of free software applications, such as email, chat, news headlines, stock quotes, and home page communities.

Although AltaVista's decision to go portal underscores the site's determination to attract more users to its service, it also could open doors for AltaVista's competitors to scavenge consumers in the high-end search market.

This was certainly Northern Light's intention. The company ran full-page ads yesterday in the form of a business letter, signed by Northern Light chief executive David Seuss, and titled, "An Open Invitation to All AltaVista Users." In it, Seuss argued that changes in AltaVista's business plan have made the company lose focus, threatening its position as the provider of the leading search technology.

"Just think, it was only four years ago when AltaVista introduced the first powerful and fast Web search engine," Seuss wrote in the ad. "Those qualities were probably the reason you started using it in the first place...Just what happened to the importance of great searching?"

In an interview, Seuss said that the campaign targeted AltaVista users who may be disenchanted with the company's new direction.

"We could come out ahead by picking up the ones that they lost," Seuss said. "By focusing on a niche market, we can be more successful than a portal."

Now that Northern Light has fired the first shot, other AltaVista competitors are joining the battle.

David Pritchard, senior marketing director at HotBot, a Lycos-owned Web search engine, said AltaVista has been losing customers for some time, thanks in part to numerous changes in ownership. Originally owned by Digital, AltaVista was acquired by Compaq Computer before being picked up by CMGI.

Despite AltaVista's fits and starts, some analysts point out that it's not too late for AltaVista to change its style. Going portal has generally saved other search engines from fading away, according to Danny Sullivan, editor of industry newsletter SearchEngineWatch.com.

Sullivan was skeptical that Northern Light's ad campaign would garner more hard-core search engine fans, since most of those Web users already use Northern Light.

"The tone of the advertising campaign may appeal to people who don't already know about Northern Light," Sullivan said. "But the people who care already about search are the people who already know about Northern Light."

 

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