Microsoft To Pay $100M For Video Search Engine VideoSurf

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The VideoSurf deal is the latest in a growing list of acquisitions from Microsoft, which had a cash pile of around $57 billion at the end of the last financial quarter. (Image: Stock.xchng)
The VideoSurf deal is the latest in a growing list of acquisitions from Microsoft, which had a cash pile of around $57 billion at the end of the last financial quarter. (Image: Stock.xchng)

FINANCE

  • VideoSurf video search features to be added to Xbox Live gaming network
  • VideoSurf privately owned with backing from Al Gore, Facebook operations chief Sheryl Sandberg and SurveyMonkey chief executive David Goldberg
  • Microsoft stepping up efforts to reel in rivals like Apple and Google

Microsoft has signed an agreement to acquire VideoSurf, a specialist in internet video search technology. The California-based company provides services that allow users to search through high quantities of movies and television shows and other forms of video content.

No financial details were revealed, though leading tech blog TechCrunch reported the deal was worth almost $100 million. Microsoft first plans to introduce the technology to its Xbox Live service to allow users to filter through the various types of video content on its gaming network.

The video search option will complement the recent Kinect voice search service that Microsoft integrated into the Xbox Live package, which allows members to search the internet with voice commands.

VideoSurf is a privately owned company with financial backing from several well-known figures such as former US Vice President Al Gore, Facebook operations chief Sheryl Sandberg and SurveyMonkey chief executive David Goldberg.

The company currently provides search functions for video content on many websites including CNN, Hulu, DailyMotion and Fancast. With mobile applications already available for Android and iPhone devices, a new version is soon likely to hit the Microsoft’s app store for Windows Phone 7 handsets.

Shopping Spree

The VideoSurf deal is the latest in a growing list of acquisitions from Microsoft, which had a cash pile of around $57 billion at the end of the last financial quarter. The most notable purchase of the year was the $8.5 billion deal to acquire internet chat giant Skype.

With Microsoft stepping up efforts to reel in rivals like Apple and Google, CEO Steve Ballmer has made it clear that the acquisition spree is far from over. "While we're certainly focused on building extraordinary technology like Kinect, we're also forging new partnerships and making bold acquisitions to break through," said Ballmer at a Microsoft shareholder gathering early November.

In other merger headlines, Microsoft recently signed a deal that will give it access to internet giant Yahoo’s financial data that will help the software company prepare a new buyout proposal, according to reports from Bloomberg.

Sources close to the matter said Yahoo has called for offers to be finalized this week, with bidders expected to put forward minority stake proposals, since they have not had time to organize loans for an outright acquisition.

Microsoft could put its money behind another bidder instead of going for a full takeover, the sources said.

Key Statistics – Search Engine Market Share & Traffic (source: comScore, July 2011)

  • Google held steady at 65.5%
  • Yahoo held steady at 15.9%
  • Bing up to 14.4%
  • Ask 2.9%
  • AOL fell to 1.4%
  • The five most-visited sites from search engines in mid-2011 were: Facebook, YouTube, Gmail, Google and Wikipedia.
  • Facebook received the largest percentage of visits (11.03%), with Google in second (9.53%), and YouTube third (4.07%).

By James Mulholland for
James Mulholland is a Paris-based internet and broadcast journalist specializing in sports, current affairs and technology news, while also freelancing as a photographer.

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