In the shadow of Google

Google Inc., the reigning king of Web search, cast a long shadow in the high-technology world last summer when it raised $1.67 billion in an initial public offering and saw its share price quickly double.

But for those who missed out on the riches, a small sector of search companies has sprung up on both sides of the country. Many are venture-backed start-ups that, rather than competing with Google head to head, are focusing on smaller business or consumer niches.

The attractiveness of these companies was underscored in November, when Microsoft Corp. cofounder Paul G. Allen made a venture investment in Eliyon Technologies Corp. of Cambridge, creator of a business search engine using natural language processing.

Eliyon is one of a cluster of Boston-area companies -- with names like Dotomi, EasyAsk, Endeca, FAST, iPhrase, Northern Light, and TripAdvisor -- engaged in search-related activity. As they scramble for a foothold, high-tech giants like Microsoft and Yahoo Inc. are readying frontal assaults on Google, and researchers at IBM Corp. and Sun Microsystems Inc. are developing new search technologies. Much of the activity is based on the premise that search is emerging as a new technology platform, not only on the Web, but on corporate intranets, computer desktops, and across software applications.

"There's a lot of business to be had in search in the next few years, and it's not all going to Google," said Susan Aldrich, senior vice president at Patricia Seybold Group, a technology research and consulting firm in Boston. "I think several of the local companies have the potential to become wildly successful and get very big."

In the burgeoning search field, there's room for more than one business model.

Google makes the bulk of its money through advertising, selling sponsored links alongside its search results, while companies in enterprise search license their technology to businesses.

"Some of the things that Google does so well, like page rankings, are irrelevant in the enterprise," said Sue Feldman, vice president and search analyst at International Data Corp., a research firm in Framingham.

Microsoft's delay in rolling out the next version of its Windows operating system, code-named Longhorn, which is expected to include advanced search features, creates a window of opportunity for smaller players over the next year or two, Aldrich said. Those that can solve problems for consumers or businesses will have plenty of customers.

"People are struggling with the issue of findability," Aldrich said.

"Over the next five years, you're going to see many niche players surviving, some will disappear, and new niches will be created."

Here's a look at three niche players in the Boston area:

EasyAsk Inc.

Go to a clothing website powered by EasyAsk Inc.'s natural language technology, and you can get precise and meaningful results from a search for "ladies footwear under $75," a query that would yield no matches or a confusing jumble of listings from e-commerce sites using searches for key words.

Over the past four years, EasyAsk's e-commerce search tools have attracted 100 customers, from Lands' End to Talbots to Coldwater Creek. Now the Marlborough company, backed by Sigma Partners of Boston and Flagship Ventures of Cambridge, is branching into the field of enterprise search -- helping employees to locate corporate data.

Bob Alperin, the president and chief executive of EasyAsk, has refined his elevator pitch to reflect the company's move behind the firewall and its targeting of a new class of customers: "We make it easier for corporate constituents to find corporate information and accelerate a path toward more fully informed decisions."

It's not hard to understand EasyAsk's motive for diversification. While Alperin estimates the market for e-commerce search software at less than $100 million a year, Alperin thinks the market for enterprise search tools is closer to $1 billion annually, and growing. IDC estimates knowledge workers spend 15 to 30 percent of their office hours seeking information.

"Companies are realizing they're leaking money because employees can't find the information they need," Feldman said.

"I like to think of this market as the Super Bowl of search," suggested EasyAsk founder and chairman Larry R. Harris, a Dartmouth College computer science professor turned technology entrepreneur.

"When there's real money involved, it really matters," he said.

EasyAsk, which employs about 50 people, offers navigation technologies to help employees of companies and other organizations surmount the problems of not knowing where to look or how to ask for data.

Its searches extend beyond the World Wide Web to relational databases, reports, documents, information warehouses, and e-mail logs within enterprises, enabling their employees to rapidly answer questions like "What color sweaters have total sales in excess of $100,000?" or "What employees speak Russian and know Oracle databases?"

After a dozen quarters of revenue growth, EasyAsk expects to be profitable midway through 2005, Alperin said.

But as it ventures into the enterprise market, it faces tough competition from a pair of larger California rivals, Verity Inc. and Autonomy Inc.

Then there's Google itself, which has been moving into enterprise search with what EasyAsk officials say is a less robust, though cheaper, offering.

Dotomi Inc.

Framed on a wall outside the executive offices at Dotomi Inc., on the edge of Boston's Financial District, are colorful arrangements of Post-it notes bearing motivational slogans offered up by employees during a company workshop: "Relevancy, Retention, Relationship," "Give Consumers Control," "Shaping the Future of Advertising."

At a time of resurgence for online advertising, Dotomi offers advertisers the ability to customize messages to consumers on banner spaces of the various websites they visit, from about.com to nytimes.com. Advertisements on Google, by contrast, are driven primarily by search terms. Through partnerships with big advertising networks, Dotomi claims to have coverage of about 8,000 US websites.

"The days of blasting your message all over the Web are over," said John Federman, president and chief executive of two-year-old Dotomi, which is backed by U.S. Venture Partners of Menlo Park, Calif., Investor Growth Capital of New York, and Velocity Equity Partners of Boston. "We're going toward a much more targeted experience. When you have a little kid in the house, you don't mind seeing an ad for Pampers. If you don't have a kid, you'd rather see something else."

Dotomi -- the name is an acronym for "direct one-to-one marketing inc." -- uses permission-based marketing to connect consumers with the marketers they want to hear from.

When a consumer books a flight to Florida from a site on travelcompany.com, for instance, the site will ask her if she wants to receive direct messages. If she does, Dotomi will drop a cookie on her browser. Then, when she goes to a website in the future, the banner ad she sees will contain a customized pitch for the best rates on upcoming flights to Florida. (Neither Dotomi nor the websites to which it delivers custom ads keep personally identifiable information on consumers.)

The technology was developed by Israeli computer scientist Yair Goldfinger, the Dotomi cofounder and chief technology officer. Goldfinger, who is based in Tel Aviv but travels frequently to Boston, was the creator of instant messaging. He turned his attention to Internet advertising after his former company, ICQ, was sold to America Online.

Dotomi, which employs 52 people worldwide, seeks to capitalize on the shift to "retention marketing" by advertisers looking for repeat business. "Retention marketers are just starting to discover the Web as a vehicle to reach consumers," said David Vogel, managing director of Velocity, which invested $1 million in Dotomi in October. Retention marketers now try to reach customers through e-mail that often gets caught in filters or lost in spam-clogged inboxes. In the future, Vogel believes, they will migrate toward customized ads.

Eliyon Technologies Corp.

In early 2000, when he was running Corex Technologies Corp., a maker of hardware and software that scan business cards, chief executive Jonathan Stern had a realization: "If I could collect information about every company in America -- what they do, what products they sell, who works there, and who used to work there -- it would be worth a lot of money," he recalled thinking.

Thus was born the idea that grew into Eliyon Technologies Corp., a Corex spinoff that provides power searches of companies and people. Eliyon, located in Corex's office building on Memorial Drive in Cambridge, has amassed a database of over 1.5 million companies and more than 23.6 million business people. "Currently we believe we have the largest database of people in business anywhere," Stern said.

Convinced of the limitations of Google-style cataloging of words on Web pages, his company developed its own Web crawlers, based on algorithms that analyze websites and correlate information. "There's a lot of relevant information that's scattered," Stern said.

Eliyon's business search engine enables customers to develop detailed corporate and personal profiles that quickly yield information such as the names of everyone at Microsoft Corp. who works on the Xbox or all vice presidents for manufacturing in the Boston area.

The technology is licensed to corporate recruiters, sales people, business development executives, investment bankers, and hedge fund managers.

Unlike many other venture-backed start-ups, Eliyon has been profitable for the past 2 years. The 60-employee company is backed by venture investors, including Venrock Associates and Vulcan Capital, Paul G. Allen's investment group.

Robert Weisman can be reached at weisman@globe.com.

Boston's search sector

Some other Boston-area companies working in the search field:

Endeca Technologies Inc., Cambridge. Sells software to search and analyze data from any source.

FAST Search & Transfer, Needham. Provides search software to businesses and other enterprises.

iPhrase Technologies Inc., Bedford. Offers search and customer interactive software applications.

Northern Light Group, Cambridge. Markets search and content integration technology.