Medio in Reported Deal with Google and Verizon, Putting Seattle on the Mobile-Search Map

And the wireless hits keep coming… Seattle mobile-search startup Medio Systems is moving towards a deal with Google and Verizon Communications to manage an all-in-one search service provided by the two giants, according to the Wall Street Journal. Medio already handles searches for limited types of mobile content for Verizon. Google would help Medio search the broader Internet, and so bring more complete search capabilities to Verizon devices. Medio would also work on bringing in additional content from companies like Facebook, splitting ad revenues with Google and Verizon—all this provided the deal goes through.

Most national media is focusing on the somewhat surprising partnership between Google and Verizon, which have been at odds over issues like wireless carriers having to open their networks to more services and handset companies (regulations that Google backed), and adoption of Google’s mobile operating system Android (which Verizon has resisted so far). The Journal article points out that telecom companies are realizing that their “homegrown” search services—partnerships with small companies like Medio and Cambridge, MA-based JumpTap— aren’t cutting it, and they need help from the big players in search.

Rafat Ali of MocoNews calls it “a good deal overall in simplifying the mobile search market.” But he also predicts that in the long term, the wireless carriers will have less and less pull. “As phones open up, users will be able to use whichever search engine they desire, not the ones deemed official by the carriers.”

From a Seattle perspective, it’s interesting to see Medio becoming a top player in the fast-growing (but still small) mobile-advertising business. Medio raised some $30 million in 2006 from Frazier Technology Ventures, Accel Partners, and others, so it has been doing well. But I think Ali is right when he predicts that the new deal might give Medio a lot more exposure and relevance, which could make it attractive as a future acquisition for Google, or another search company.

I bet Google has the inside track—Medio co-founder and CEO Brian Lent worked in the same lab as Sergey Brin and Larry Page as a graduate student at Stanford in the mid-1990s. Lent even had chances to join Google in the early days, but chose not to, as the P-I reported a few years ago. But the circle may yet be completed.

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