Google Tops Halfway Mark For Search-Engine Market Share

location based services

Google's 50% share of the market eclipsed that of No. 2 Yahoo and No. 3 Microsoft MSN, which accounted for 22% and 11% of the market, respectively, Nielsen/NetRatings said.

By Antone Gonsalves
TechWeb.com

May 26, 2006 04:49 PM

Google in April accounted for one in two U.S. Web searches, a milestone for the search engine, a market research firm said Friday.

Google's 50 percent share of the market eclipsed that of No. 2 Yahoo and No. 3 Microsoft MSN, which accounted for 22 percent and 11 percent of the market, respectively, Nielsen/NetRatings said. Google's share grew 3 percent from the same month a year ago, while Yahoo was flat and MSN dipped 1 percent.

"It's a milestone in the sense that it's a significant accomplishment for Google to garner half of the search in the United States," Michael Lanz, vice president of search industry solutions at Nielsen/NetRatings, said. "Google is well positioned to capture the lion share of search-based advertising in the future."

The fact that Google continues to gain market share at the expense of Yahoo and MSN, shows that the latter two rivals have yet to find a way to catch the leader.

"The recent share statistics point to the extreme brand loyalty people have to Google," Lanz said. "It's obviously very hard for Yahoo and MSN to get market share, when they have such a dominant player as Google in the market."

To close the gap, Yahoo and MSN will need to show better innovation and search functionality than Google and offer consumers attractive incentives to switch, Lanz said. For smaller players, there's room in the market for search focused on specific areas, such as healthcare or real estate.

Not all the findings were bad for Google's competitors, particularly Yahoo. In terms of growth in actual number of searches, Google and Yahoo were very strong year-over-year. Google saw a 34 percent jump in April to 2.7 million, and Yahoo was up 27 percent to 1.2 million. MSN trailed with a 10 percent increase to 570,000.

Nielsen's numbers were quite a bit higher than competitor ComScore Networks, which recently said Google in April had a 43 percent share of the market, followed by Yahoo, 28 percent, and MSN, 13 percent. Estimates by market research firms often differ due to methodologies.

In addition, Google's lead in search doesn't translate into use of the most popular portal services. In that market, the search engine lags way behind rival Yahoo and in some cases MSN.

In Web mail, for example, Yahoo Mail has a 42 percent market share, followed by MSN Hotmail, 23 percent, according to Web metrics firm Hitwise. Google Gmail is far behind at less than 3 percent.

Nielsen also found in its latest report that consumers were increasingly connecting with major retail stores via search engines, underscoring the influence search has on online and offline buying. All of the top five shopping keywords in April were for brick-and-mortar stores. The retailers, in order, were Home Depot, Wal-Mart, Target, Sears & Roebuck and Best Buy.

The retailers' performance reflected a strong Web presence that encouraged consumers to buy immediately online, or offered the tools needed to do preliminary research before making an in-store purchase, Lanz said.