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Jimmy Wales, co-founder of Wikipedia and Wikia, last week shared his view on why search engine startups bother to compete with Google. The search engine has, by most accounts, 60 percent to 70 percent of the search market worldwide.
Game over, right? Not necessarily, according to Wales, who told me the lack of a network effect enables users to easily move from one search service to the next. This is in contrast to other Web services, such as Facebook or MySpace, whose social networks can bar people from leaving.
Once you’ve put your info in Facebook or MySpace, it’s in there. Despite the Google-fostered OpenSocial effort, it’s still not practical to move all of your data from one social network to the next.
Google users aren’t encumbered by this; they are free to move about from Web service to Web service. Wales told me that if a company can offer search with augmented value, such as Wikia’s peer-influenced approach of letting users instead of machines influence search results, that company might have a shot at luring some users from the Googlezilla.
Enderle Group analyst Rob Enderle agreed with Wales that the switching cost for the user is low, meaning Google could get nibbled to death by services that target specific users or groups.
However, he allowed that the advantage Google has is that we are all “creatures of habit and need a cattle prod, once we have become familiar with a product, to move us off of it.”
I agree with this statement, which is reflective of the “if it isn’t broke don’t fix it” adage. And, while I appreciate Wales’ and Enderle’s shared sentiment about opportunities for new players in search, I respectfully disagree.
If a new player, be it Wikia, Cuil, Mahalo, or Hakia, begins to take share from Google, Google or someone else will likely buy it. Look at Microsoft and Powerset. Powerset positioned its semantic search as Google killer and Microsoft snapped it up.
Also, while desktop search ads are currently the main moneymaker accounting for Google’s $16 billion a year-plus sales, Google has just created a mobile operating system in Android that seems primed to keep users searching Google from smart phones and God knows what other devices.
If you trust that mobile is the next frontier for search, then Google already has a leg up provided carriers create phones in addition to the new T-Mobile G1.
Toss Google’s Gmail and other apps, which may be paired with ads, YouTube’s video ads and new e-commerce platform, and a litany of other Web services Google monetizes or plans to monetize with ads, and it’s hard to find a crack in Google’s great armor.
Can Anyone Stop Google?
Sterling Market Intelligence analyst Greg Sterling is torn. He told me the idea that Google will lead search for the next 20 years or so seems logically impossible.
While Microsoft has dominated desktop software with Office for the last couple decades, the same monopoly seems impossible given the highly transitive nature of the Internet, Sterling argued.
“However, there have been a lot of competitors that have come at Google, including very, very well funded ones such as Microsoft and Yahoo, without success. In a period of intensifying search competition, Google seemed to consolidate its lead. The more money and attention was poured into the space, the more Google seemed to grow. Google has become this unassailable juggernaut in search, but you just can’t imagine the company maintaining this indefinitely, but I could be wrong.“
One of the issues is that while Hakia, Wikia, and others make bold claims, they haven’t duplicated the efficiency of Google search.
Moreover, Sterling said his inclination is to look at the mobile search market, but Google is already established there and stands to grow larger thanks to Android.
One reader, Jim P., argues that Google’s proprietary search and ranking algorithms, the keys to making the search engine so effective, will ultimately give ground to an open source provider.
“I anticipate that eventually, some search engine will allow the USER to select and tune their own ranking algorithm(s). And that many new and tunable or configurable algorithms will become available through open source efforts. The aim is for the USER to control the search biases with full transparency. Could Wikia Search be that new, free and open search engine on which 21st century freedom will depend? Google, for all its value, clearly is not.“
Methinks Jim P is placing too much emphasis on the power of open source versus proprietary systems. Linux may be a big bugaboo for Windows, but it has hardly unseated that desktop operating system juggernaut. I suspect this will hold true in search.
Sterling, meanwhile, said there will be some successor to the current version of search, noting that it could come from mobile or Internet-based television. This provider would have to be more effective and efficient than Google.
I agree, but we haven’t seen it; it’s certainly not available in the market now despite all of the bold claims of betterment from today’s search startups.
I see nothing that can effectively challenge Google’s reign, either now or in the foreseeable future.