Overture’s revenue is up and its profits are down.

In fact, Overture’s net profit margin has declin
ed steadily quarter-by-quarter over the last year from 20.6% to 4.8%
. This is not terribly surprising because what they do isn’t very special. Yahoo clearly intends to integrate into Overture’s business and Google has already done so.

There will probably always be a role for Overture in the marketplace, but Overture’s business is going to look a lot more like that of an ad rep firm or network.

The problem is that it’s just not that hard to do what they do. The hard part is building the traffic in the first place and therefore it’s the site carrying the ad and not Overture that should be rewarded. As their revenues are squeezed and it becomes easier to build than to buy, Overture will increasing need its partners more than they Overture.