Pitiless Google Steals Search Share From Rivals

By Juan Carlos Perez
Thu, May 22, 2008

IDG News Service —

Extending its dominance in the search market, Google grew its share of queries in April at the expense of rivals Yahoo, Microsoft, AOL and Ask.com.

Google's U.S. search query share in April grew to 61.6 percent, up from 59.8 percent in March, comScore announced Thursday. Google accomplished this although the number of search queries dropped 2 percent overall in April to 10.58 billion, compared with March, comScore said.

So even with the overall monthly decline, Google managed to increase its search queries by 1 percent, from 6.44 billion to 6.51 billion.

Meanwhile, the other four major search-engine players saw their queries and their market share drop in April, compared with March, not a great situation for them to be in, considering that search advertising accounts for about 41 percent of U.S. online advertising, according to the latest report from the Interactive Advertising Bureau (IAB).

Yahoo's market share of queries dropped to 20.4 percent, and its number of queries fell 6 percent. Microsoft's market share shrunk to 9.1 percent, while its queries fell 5 percent. AOL, down to a 4.6 percent share, saw its queries drop by 6 percent. Ask.com, whose share slid to 4.3 percent, had the biggest fall in queries percentage-wise with 9 percent.

A desire to improve its position in search was a primary driver for Microsoft's now-abandoned acquisition bid for Yahoo. However, Microsoft is reportedly trying to strike a search deal with Yahoo, which is also in similar negotiations with Google. It's not clear whether Yahoo would be open to selling its search-advertising business outright or instead seek a deal to outsource part of it to Microsoft or Google.

Whatever happens, comScore's figures for April leave no doubt that Microsoft and Yahoo have resoundingly failed to slow down Google in search, and that Google remains well-positioned to use its search dominance to continue boosting its revenue and profits.

In a research note commenting on the comScore report, Citigroup analyst Mark Mahaney wrote: "As Google continues to take share, we continue to believe a deal between Yahoo and Microsoft would be necessary -- though not sufficient -- to compete effectively with Google."

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