AltaVista: The Search Giant That Invented CAPTCHA and Lost to Google

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AltaVista launched on December 15th, 1995 as the first full-text searchable index of the World Wide Web, and it was never meant to be a consumer product. Researchers at Digital Equipment Corporation built it to show off server hardware: Paul Flaherty had the idea, Louis Monier wrote the multi-threaded crawler nicknamed Scooter, and Michael Burrows wrote the indexer. With 64-bit Alpha processors holding the index in memory, it handled 300,000 hits on its first day and more than 80 million a day by 1997.

This episode follows what happened once the hardware demo became one of the most visited sites on the planet. AltaVista powered Yahoo's search results, launched the Babel Fish translator in 1997, and created the first CAPTCHA to block spammers stuffing its index. Then Compaq bought DEC for $9.6 billion, spun the site off under CEO Rod Schrock, and buried the search box under email, stock tickers, shopping, and free dial-up in pursuit of stickiness, just as a clean white page called Google arrived.

In August 1998 Compaq paid $3.3 million for altavista.com, replacing the clunky altavista.digital.com address.
Staff grew from 80 people to more than 600, backed by a $120 million Smart is Beautiful campaign with TV ads featuring Pamela Anderson.
CMGI bought 83 percent of AltaVista in June 1999 for $2.1 billion in stock and $220 million in cash, but the planned IPO was canceled when the bubble burst.
In 2000 AltaVista still reached 17.7 percent of internet users against about 7 percent for Google, yet a stripped-down 2002 redesign could not win people back.
Overture bought the company for $140 million in 2003, and Yahoo shut the site down on July 8th, 2013.

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