Bambi Francisco, John Battelle, Fredrick Marckini, Kevin Ryan and Dana Todd discussed and debated the future of search in a provocative ad:tech panel.

MarketWatch columnist and blogger Bambi Francisco moderated a thoughtful and forward-looking panel of thought leaders as they discussed where search is going.

The panelists (in alphabetical order) were John Battelle, founder and chairman of Federated Media and also author of "The Search;" Fredrick Marckini, CEO and founder of iProspect and author of "Search Engine Positioning" (among other books); Kevin Ryan, managing partner of Kinetic Results and iMedia's own search editor; and Dana Todd, executive VP of SiteLab International, Inc.

Francisco opened with some telling numbers. "Last year saw a record number of search startups get funded." If you extend the time frame, the numbers go up. All told, VCs invested 916 million dollars in 130 search startups over the last five years-- 82 in the last two years alone. Once again, "search is hot."

And the enthusiasm for search isn't only on the VC side, Francisco observed. According to the Pew Internet & the American Life project, in December 2005 for the first time search tied with emailing as the number one online activity.

"It's clear that VCs and startups think that they can improve upon the search results we get today," Francisco said, "but no one knows how the future will unfold."

To illustrate the sometimes-dodgy quality of search results, Francisco showed screenshots of A9 searches for each of the panelists. While generally accurate, the results surprised some of the panelists.

John Battelle didn't know that an audio version of his book, "The Search," was available for download at Audible.com, and looked forward to the forthcoming royalties. Dana Todd was initially perplexed by the image of a toaster on her results page, but then realized that, "About four years ago I won that toaster from Atlas, when it was called GoToast." 

Bambi Francisco then asked John Battelle, "What's going on with Ask.com, and should advertisers be spending more money there?"

Battelle replied that, "Ask has always been the perennial number four" in search, but that it was "growing quickly against its own base." He then observed that after "Steve Berkowitz did a turnaround, Microsoft's picking him off to run a very big portion of its online biz" was good for Microsoft, and probably bad for Ask. When Battelle chatted with Ask.com CEO Jim Lanzone about the Berkowitz departure, Lanzone "was extremely CEO-like in his responses to me, which is to say that he didn't say very much." Battelle also remarked, "At Microsoft, the one thing that I worry about with Steve going there is that he doesn't control product development."

Turning to Dana Todd, Francisco looked at MSN's new adCenter beta, asking "will it raise the bar?"

"MSN is representative of a change, and we're always looking for the next thing in search," Todd answered. But she went on to say that she's leery of layering demographic and behavioral targeting onto search because, quite simply yet accurately, "we're more complex than that."

"The premise is pretty cool," Todd continued. "If a marketer is selling tennis shoes to women, at MSN she can buy a premium to get a higher listing for that demographic, but is this a step backward?" In the old days, Todd observed, "we bypassed all those demo metrics and went right to intent. As a user, I'm many, many things in a day. I'm a business person. I'm just Dana Todd looking for cool music. I'm Dana Todd looking for presents for her brother." And as more and more gets shoved into search, "the results are getting muddier." For example, Todd said, having recently moved to New York, her Google results haven't caught up, and she continues to get listings from her former home city, San Francisco.

Bambi Francisco then turned to Fredrick Marckini, noting that in a recent statement Yahoo! CEO Terry Semel claimed that Yahoo earns 10 percent more revenue per page view. "Why is Yahoo monetizing better, and are advertisers actually seeing better results?" Francisco asked.

Marckini replied that it's all about paid inclusion. "Only Yahoo does it, so they're the only ones who can monetize that way." Paid inclusion gives marketers, "a lot more control over the listings. You get better results-- it's a phenomenal way to increase revenue for the client… It's kind of like instantly having 100,000 lottery tickets rather than just having 20,000, so the results are just huge."

Francisco then asked Kevin Ryan how Google's recently invested five percent stake in AOL might affect ad spending.

"This was," Ryan replied, "the first move that Google made where we say that Google was trying to edge out the competition, and it certainly didn't do them any good to edge out MSN in this process." Yet, Ryan did not think that the investment made a significant difference in the search landscape. "As far as the advertisers are concerned, it's the search space: We're looking for performance." If the Google and AOL combination "can deliver the audience, then it's good."

Bambi Francisco then changed gears from initial one-on-one questions to more give and take, asking about the growth of specialty and vertical search. With, for example, 2.9 million regular searches on A9 (a tiny amount compared to Google), audiences are increasingly going to specialty search "because they can get deeper, richer information, and perhaps more targeted information."

"Vertical search has been here for a long time," Fredrick Marckini noted. "What is Amazon but a book search engine? A search for tiger on ESPN is a lot different than a search for tiger on AnimalPlanet.com." Specialty search gives marketers, "an opportunity to think outside the box." Bose, the makers of an iPod speaker system, should realize that for iTunes users, "the iTunes search engine of preference is iTunes." And Bose "should create iTunes content and brand it Bose."

"Or podcast about it," Kevin Ryan added.

Next: Search as a navigational tool, social search and the affect of offline advertising on search.

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