Search engine to acquire Bloglines

Search engine Ask Jeeves is rumoured to be buying Bloglines, the online service for searching, subscribing, creating and sharing RSS feeds and blogs.

Two things make this news interesting from a communication viewpoint:

1. The formal public announcement apparently isn’t due to be made until Tuesday, but was scooped by Mary Hodder in a post on her Napsterization blog on Saturday. Says Hodder: "I’m sure Jeeves is asking himself how I know this. I learned it from a couple of folks. Once that happened, it seemed reasonable to blog it."
2. No one from Ask Jeeves or Bloglines has made any comment publicly to confirm or deny Hodder’s story, nor have any mainstream media yet carried any reports. The only reporting so far has been on blogs over the weekend. Does this mean ‘mainstream media’ don’t work at weekends? Or don’t report on rumours any more? Or weren’t paying attention?

Ask Jeeves announced its financial results last Thursday and reported tripled revenue which, according to the Wall Street Journal, was below financial analysts’ expectations. Shares fell 5.8% on the Nasdaq stock market.

Last week, I read a post by Bill Burnham in his Burnham’s Beat blog on the coming blog wars. His penultimate paragraph:

There are a bunch of blog aggregation sites such as Bloglines, Technorati, del.icio.us that appear on the surface to be interesting acquisition opportunities, but it is unclear what these sites really add to the existing capabilities of Yahoo and Google as these sites focus on end-users, not bloggers, and Google and Yahoo already have plenty of end-users.

Yesterday, in an analysis for investors in The Internet Stock Blog, author David Jackson says:

The price of playing in the search game is rising. One way of viewing this: Ask Jeeves may not generate incremental revenue from acquiring Bloglines, but is forced into the acquisition to keep its search results competitive. But the acquisition costs money; so too does scanning library books and photographing local stores. Looks to me like search margins will fall.

Update 8 Feb: It’s now official – Welcome, Bloglines! announcement last night on the Ask Jeeves blog, plus Letter to Bloglines Subscribers and Acquisition FAQ on Bloglines.

See also – Bloggers won’t keep a secret on MarketWatch: "If there’s any question how Web logs and the Internet have changed the news business, talk with executives at Ask Jeeves Inc."