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February 24, 2009

Even Google Seems Uneasy As It Overwhelms Its Rivals

The popularity of the Google search engine in the United States just grows and grows. In the past three years, its market-share gains have even been accelerating, making some people wonder whether the company will eventually obliterate what remains of its competition in search.

Certainly, antitrust scrutiny is a growing worry at the Googleplex, the nickname for the company’s headquarters. Last year, the company abandoned a proposed advertising pact with Yahoo when the U.S. Justice Department said it would file an antitrust lawsuit to block the deal. Last week, a small Web site operator, TradeComet.com, filed an antitrust suit accusing Google of unfairly manipulating its advertising system to harm a potential competitor.

And when I asked to speak with Google’s chief economist about why its market-share gains were accelerating, the press office also gave me, unrequested, a second, separate appointment with Dana Wagner, the company’s “competition counsel” — that is, its point person on antitrust issues.

Google maintains that its lead in the Web search market is tenuous, and that a user’s loyalty could evaporate with a simple click of a mouse.

But consider this: As recently as July 2005, Google was ahead of Yahoo in market share by just 6 percentage points, 36.5 percent to 30.5 percent, according to comScore, the market research company. Today, that advantage stands at 63 percent to 21 percent.

“You almost feel sorry for Google,” said Danny Sullivan, editor in chief of Search Engine Land. “They’re doing a good job, and people are turning to them. But when they pass 70 percent share, people are going to be uncomfortable about Google becoming a monopoly.”

Google does not register gains every month. The comScore numbers for January reflect a 0.5 percent drop in its share from December and a 0.5 percent gain for Yahoo. But according to Hitwise, another online…

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