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Verizon, Google close to mobile search deal, report says

Jeff Richgels  —  8/22/2008 10:06 am

Verizon Communications is nearing an agreement with Google on a wide-ranging partnership for mobile searching, the Wall Street Journal reported Friday.

The paper, which cited people familiar with the situation, called it the latest sign that telecom companies are finally conceding that their homegrown search services have stalled -- and that they need help from the Internet's big guns.

Carriers have been reluctant to team up with established Internet players, not wanting to hand over a potentially lucrative stream of advertising revenue.

The deal under discussion, which would make Google the default search provider on Verizon devices and give it a share of ad revenue, is aimed at dramatically simplifying what is now a confusing set of search options for cell phone users. Today, users have to go to different places to look up services such as ring tones, restaurants and Web pages. Verizon wants to create a new search platform that would be a one-stop shop.

The mobile search advertising market is still tiny, with only about $244 million in spending expected this year, according to eMarketer. But carriers and Internet companies view it as an area of rapid growth for the future, the paper said.

The paper said the two sides still are negotiating on key issues, such as Google's desire to save information from user cell phone searches. Carriers prize such information and are reluctant to turn it over.

Verizon is the No. 2 wireless provider in the U.S. by subscribers.

Jeff Richgels  —  8/22/2008 10:06 am