This week, Yahoo and Google both unveiled new approaches to Web searching, with each emphasizing personalization.

Google’s personalized search uses an individual’s search history to help tweak search results. For instance, if a person has looked for cars extensively in the past, a search for “Jaguar” will return car sites rather than ones featuring large wild cats.

While Google’s new tack is admirable, Yahoo’s soft-launch is more startling, since it moves away from the company’s traditional search methods. Instead of using search algorithms, as in the past, Yahoo is tapping into its community of users (80.5 million people visited Yahoo in May, according to NetRatings) to assist in setting the ranking and relevance of search results.

First introduced in April and significantly updated this week, Yahoo’s MyWeb allows users to designate sites as share-worthy and to search what others in their Yahoo-based communities or the larger Yahoo user base find relevant. When a user logs into MyWeb, she can search through what others in her communities have saved, through what the MyWeb community at large has saved, or search the Web without the MyWeb interface. If the user finds a site she likes, she can select “Save,” which calls up a separate window. A user then titles the page, adds some keywords (to aid others in their own searching), and then designates if she wants to save the site for herself alone or to share with others in her community or the rest of Yahoo’s visitors.

The keywords, or “tags,” which are bits of information that describe the site and why it’s good, form the kernel of MyWeb 2.0. Much of the tagging expertise at the core of the product comes from Yahoo’s acquisition of Flickr in March 2005, a photo-sharing community that uses tags to help people sort and find photos online, upload them, and share them with others. It differs from sites such as Ofoto because its users can add tags describing their photos and append comments via text message boxes on photos. Others can then search Flickr for keywords (say, “orchids”).

“The Flickr folks worked heavily on this,” says Eckard Walther, vice president of products at Yahoo’s search division. “Flickr does for photos what we want to do for the Web.”

In addition, Yahoo decided to open up its MyWeb 2.0 application programming interfaces (APIs), which will allow the wider programming community to create other uses for its new search engine.

Walther says that Yahoo is also soliciting comments from Stanford engineers on the project, and will also approach research labs across the country for input and design ideas.

It’s too early to tell if either Yahoo’s or Google’s new service will upend the balance of the search battle. Yahoo has already taken up Google’s strategy of releasing beta versions of products to gauge the public’s reaction. Still, it’s striking that Yahoo is tinkering so dramatically with its core product.

“Yahoo is getting back to the roots of the company,” says Walther, responding to a comment that the company’s penchant for releasing beta products wasn’t as strong until Google started doing it. “It’s the way we used to do it. The company was founded by two engineering students – and this is all about engineering.”

Yahoo hasn’t laid out plans about how it will monetize this new development, but there are several possibilities. On one hand, it’s another advertising strategy, since it generates search results around which keyword ads could be placed. On another level, “it can build search loyalty,” says Charlene Li, an analyst with Forrester Research.

Li says that people using social search methods with friends and others in their network will be less likely to go elsewhere, and therefore might potentially also purchase items from Yahoo Shops or sign up for a premium Yahoo email account. 

With MyWeb 2.0, it’s clear that Yahoo is looking to differentiate and reposition itself as a leader in Web searching –  a title now held by Google. Its new approach is unique among the search giants, and it taps into growing user acceptance of the concept of tagging.

“Yahoo is trying to find new relevance,” says Greg Sterling, an analyst with The Kelsey Group. “MyWeb 2.0 adds the community layer and brings in…people capturing content, something Google doesn’t have.”

Eric Hellweg is an award-winning writer and editor who has covered business and technology for over 10 years.