Yahoo! homes in on Orange deal

Yahoo! is close to clinching a deal to bring its online search service to customers of the mobile phone operator Orange.

The deal would be a significant victory for the American search engine and online portal as it battles for space on the mobile web against its rival Google.

Yahoo! already has a deal with the mobile phone operator 3, but has been trying hard to get its service adopted by other networks.

As networks get faster, and the screens on mobile phones become sharper - allowing pared-down web pages to be viewed- major Internet players are realising that the next battleground for customers will be on mobile handsets.

There are already more than twice as many mobile phones in the world as there are computers, and the rate of mobile adoption, especially in the developing world, far outstrips the pace of PC sales. Many of the leading dotcom players already have standalone mobile-accessible portals and services.

Yahoo!, for instance, has a mobile version of its portal operating in the UK. But the networks themselves can play a key role in driving traffic.

The key is the power that they have as the first point of contact when mobile users go online on their phones. In the lucrative world of paid-for search advertising, dominated by Google and Yahoo!, this traffic can easily be monetised.

Working directly with a mobile operator also opens up the possibility of tailoring searches to a person's location, something that has long been seen as the holy grail of the mobile web.

Google has already snapped up T-Mobile as a customer, and users of its popular Web 'n' Walk service - which allows customers to browse the Internet and gives easy access to personal email via mobiles - are directed straight to Google's home page when they click on the service's icon on their phones. Google has also signed up with Vodafone but the two partners have yet to announce a product.

Some in the online industry had feared that Google would dominate the sector. But in June, 3 - owned by the Hong Kong-based conglomerate Hutchison Whampoa - signed up with Yahoo! to offer a range of services over mobile devices including searches, Yahoo! Messenger and email.

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