Ask.com, the question-and-answer search and expert service, bought recommendation engine nRelate this week. The deal, says Ask.com CEO Doug Leeds, is a big bet on the growing importance of content recommendation features.
The acquisition reflects the changing landscape of search, in that it may still be the primary way for a user to find content, but other methods—namely social referrals and content recommendation engines—are becoming increasingly influential.
According to Leeds and nRelate CEO Neil Mody, the deal will integrate Ask.com’s search technology into nRelate’s recommendation platform to better serve up automated content suggestions related to the particular article a visitor is viewing.
"We were looking to expand our business into areas where we can leverage the technology we built and get a part of the third leg of what’s going on in the Internet," says Leeds. "The way the people navigate the Internet these days is search, it’s the oldest method of content discovery and has remained so until two new phenomenons came along—social, which is the second leg, and then the ability for publishers to recommend the content you’re going to read next."
nRelate currently services about 35,000 publisher sites and, says Mody, serves up about 1 billion impressions each month. "With the Ask technology built in we’re looking to improve the types of links we provide on an algorithmic basis and then, over time, explore some ideas that can increase our suite of products for publishers," he says.
At this point, Mody says nRelate is monetizing some of its customer sites better than AdSense. "We’re not doing that across the board, but for us that’s a great market validation. We’re getting a 6 percent clickthrough rate. About one in every 16 views on a page clicks on our unit. There’s really nothing else that gets that kind of CTR on a page."
Ask.com, which attracts about 65 million unique visitors each month, is one of about 50 digital brands belonging to IAC, which also counts Newsweek/The Daily Beast, College Humor, Dictionary.com and a variety of singles sites like Match.com among its portfolio. First-quarter revenues for IAC were $640 million, up 39 percent from the same period in 2011, according to company financials. Net income for the quarter was $34.5 million, up 91 percent.
Terms of the deal were not disclosed and financials aren’t broken out for individual brands, but IAC’s search segment accounted for $343 million in revenue for the quarter.