Nestled in the hills of Mountain View, California, sits one of biggest profit pools in business history. The site is the home of Google, whose search engine has for the past two decades been humanity’s preferred front door to the internet—and advertisers’ preferred front door to humanity. Every second of every day, Google processes perhaps 100,000 web searches around the world—and, thanks to its “PageRank” algorithm, serves up uncannily relevant answers. That has conferred onto Google verb status. It also adds up to billions of daily opportunities to sell ads that the searchers see alongside the results of their queries. The results’ accuracy keeps users coming back, and rivals at bay: all other search engines combined account for barely a tenth of daily searchers (see chart 1).
Advertisers pay handsomely for access to Google’s users, not least because they are typically only charged when someone actually visits their website. The revenue of Google’s parent company, now called Alphabet, has grown at an average annual rate of over 20% since 2011. In that period it has generated more than $300bn in cash after operating expenses (see chart 2), the bulk of it from search. Its market value has more than trebled, to $1.4trn, making it the world’s fourth-most-valuable public company. Unlike Apple and Microsoft, its bigger middle-aged tech rivals, it has not felt the need to reinvent itself. Until now.
The reason for the soul-searching in Mountain View is ChatGPT, an artificially intelligent chatbot designed by a startup called OpenAI. Besides being able to have a human-like conversation, ChatGPt and others like it can draft equally human-seeming poems, history essays, computer code and just about anything else that people write down, paint, compose or sing. UBS, a bank, reckons that since its launch in November ChatGPT has gained around 100m monthly active users, a feat that had taken TikTok, the world’s fastest-growing social-media platform, nine…
2023-02-08 14:21:15 Is Google’s 20-year search dominance about to end?
Post from www.economist.com
For two decades, Google has been the world’s most prominent search engine, commanding the lion’s share of the search market. But with the advent of new competitors, such as Microsoft’s search engine Bing, and more recently, DuckDuckGo, is Google’s 20-year search dominance coming to an end?
At the outset, it must be acknowledged that Google’s dominance of the search engine market has been nothing short of remarkable. It has consistently held a market share of roughly 90 percent despite emerging threats from competitors.
However, there are a few indicators that Google’s long-held status as the de facto search engine choice may be waning. For one, more users seem to be turning to challengers like Bing and DuckDuckGo for more privacy-minded searches. Bing’s market share has been consistently growing in recent years, and DuckDuckGo has seen an impressive increase in its share of search queries.
Furthermore, over the past several years there has been an increased focus in the tech industry on developing search engine technologies that not only deliver results close to Google’s, but also prioritize user privacy. This has included prominent initiatives such as Apple’s “WebKit”, which is designed to protect user privacy when engaging with search engines.
Overall, while Google’s current dominance of the search market is still unquestionable, there is evidence that suggests that its long-held position could become tenuous in the future. With new competitors emerging and developing technologies designed to prioritize privacy, the winds of change are definitely blowing in the search industry. It remains to be seen if Google will be able to weather the storm.