Another Tiny Tech Deal

In this market, it is tough to find growth. For a while, it looked as though the Net sector -- especially those with a heavy concentration of search -- would be the savior for investors. But, with Yahoo's (NASDAQ:YHOO) recent earnings report, investors have had a good dose of reality.

This week, investors have more to be anxious about as companies such as eBay (NASDAQ:EBAY) and Amazon.com (NASDAQ:AMZN) report their earnings. The whole sector is getting hit, such as AskJeeves (NASDAQ:ASKJ), FindWhat.com, and DoubleClick (NASDAQ:DCLK).

Part of the explanation comes from investors' overinflated expectations. Then there is the fact that summer is fairly slow for Net traffic.

Yet the fact remains that there is a tremendous amount of deal activity in search. True, the deals have been relatively small -- basically, micro deals.

Look at yesterday. InfoSpace (NASDAQ:INSP) announced a partnership with Amplify. This deal will provide InfoSpace users with a search toolbar. Essentially, InfoSpace wants to get a piece of the search gold rush. What makes this particularly appealing is that InfoSpace can leverage search into wireless, an area that seems to have been overlooked.

At some point, though, there will be pressure to do bigger deals. And, with valuations falling, that time may be sooner than later.

Fool contributor Tom Taulli is the author of The EDGAR Online Guide to Decoding Financial Statements. He does not own shares in any of the stocks mentioned.