In most markets Google is the dominant search engine by a significant margin. No more so than in NZ where, according to latest Hitwise figures, Google’s share is 92.8%.

Add in the fact that YouTube, also owned by Google, is the 2′nd biggest search engine globally & it’s clear Google dominance of the NZ search market is almost total.

New Zealand Search Engine Shares

The extent of Google’s dominance in other markets varies, e.g. Australia 87.3%, US 71.2%, & UK 89.43% (source: Hitwise Jan 2010). And of course there are also some notable markets, such as China, Japan & Korea where Google plays second fiddle (or lower, as in the case of Korea).

Despite this, Google is clearly the #1 search engine globally. According to latest figures from Hitslink Google’s global share in January exceeded 85%.

In many quarters growing concern is being voiced about Google’s increasing dominance and the associated market control it brings. Given this, it’s not surprising that the Yahoo & Microsoft combined search and advertising arrangement has just been given clearance by both the European Commission and the U.S. Department of Justice.

Clearly the hope of these regulatory bodies is that the combined strength of Microsoft & Yahoo! will present Google with a serious competitor & keep the market competitive.

Whether this will be the case remains to be seen, given Yahoo’s share of the U.S. search market has been steadily declining. In January 2010, its share had dropped to just 14.63% compared to Bing’s share which had grown to 9.64% according to Hitwise. Most of Bing’s growth seems to have been at Yahoo’s expense rather than Google’s.

The 10-year agreement will see Microsoft taking over Yahoo’s organic and paid search platforms, while Yahoo handles sales. In other words, Bing will become Yahoo’s underlying search engine & Microsoft adCenter will replace the Yahoo! Search Marketing PPC platform, AKA ‘Panama’.

Merging these is going to be a BIG job & won’t happen anytime soon. According to a joint statement issued on Feb. 18, the two companies “hope to make significant progress transitioning U.S. advertisers and publishers prior to the 2010 holiday season, but may wait until 2011 if they determine the transition will be more effective after the holiday season. All global customers and partners are expected to be transitioned by early 2012.”

Given Microsoft adCenter doesn’t currently operate in Australia & NZ, I don’t think we’ll be seeing Google’s domination on the PPC advertising market in this part of the world challenged by Microsoft/Yahoo in the foreseeable future. Any more immediate challenge is likely to come from different quarter altogether.

And that’s Facebook…something we’ll discuss in a future post.

After a number of false starts Yahoo & Microsoft have finally agreed to join forces in the battle against search Goliath Google.

Recently Yahoo and Microsoft agreed to a 10 year partnership, although it may take up to two years for the full plan to take effect. Then the top three search engines will become just two – Google & Bing.

Goodbye Yahoo Search!

No, Yahoo isn’t closing, but it is finally throwing in the towel as a search engine. The agreement means Yahoo will be outsourcing its organic and paid search to Microsoft’s new search engine, Bing. Specific details of the agreement remain unclear, but it seems Yahoo will license its search technologies to Microsoft who will cherry pick bits to incorporate into Bing. In exchange Yahoo will receive an 88% share of all search revenues Bing generates from sites owned and operated by Yahoo.

The overall look and feel of Yahoo is expected to stay the same. However in time Yahoo’s sites will be branded with “Powered by Bing.” The biggest change will occur behind the scenes when Bing’s organic and paid search algorithms become the main platform for Yahoo’s web sites. This merging of technologies is meant to encourage more innovation in search and make Bing a true competitive force against Google.

But will this partnership really be a good thing for advertisers and consumers? The jury’s out on this.

Many welcome the move because of Google’s increasing global dominance in search. The hope is that Bing will become a credible alternative competitor and so undermine Google’s dominance in all things search. (The irony of monopolistic hard-playing Microsoft taking the role of David in this David & Goliath battle is not lost on most).

Some however see this merger as being detrimental and limiting options for consumers and advertisers. Google, Bing and Yahoo often present quite different search results because they each use very different search algorithms. Opponents to the merger see that taking Yahoo out of the equation will force consumers to choose between just two of the world’s largest tech giants. In addition they argue that advertisers will have less options, which means it may cost more to incorporate paid search into search marketing campaigns.

In my view the objections to the merger don’t hold water – certainly for consumers and advertisers in New Zealand. Here Google absolutely dominates the search market with a share of 95% +. This is high by global standards and the reality is that in NZ there is no real competition for Google.

Personally I’m a huge fan of Google because they are so very good at what they do. However, despite this, it would be great to have a viable alternative competitor in the market because Google’s market share here is just so high. Whether that happens or not, remains to be seen.

What do you think?

Here’s a funny T-shirt I found in a Bangkok night market, of all places…

No, you won’t find this in the Google store.