Why Google is 'right to be paranoid'

Despite dominant search market share, Google still feels competitors breathing down its neck

Google is still master of the search domain, but that hasn't stopped the company from looking over its shoulder.

The latest survey from the Pew Internet and American Life Project found that 83% of American Internet users say they use Google as their primary search engine, vastly more than any other individual search engine. Yet despite this, Google is constantly implementing changes to its model, most recently in its efforts to increase its semantic search capabilities and its attempts to provide more direct answers to user queries rather than the standard list of websites.

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Gartner analyst Whit Andrews (pictured) says that Google actually has a good reason to be paranoid about competition despite the fact that its brand is synonymous with online searches. In this question-and-answer session, we'll ask Andrews about what challenges Google faces in its quest to remain on top and what it would take for a competitor to knock Google off its search perch.

Network World: Google is far and away the top search engine in the world, having an even greater market share of search than it had a few years ago. Does Google really have to worry about other search engines eating up its market share since it's already so firmly entrenched?

Whit Andrews, analyst for Gartner: Google will always feel competitive pressure. Bing seems to have woken Google up a little bit. Google is right to worry about competitive pressures from other search engines because there is no operational cost from switching from one search engine to another.

At the same time, Google also has some advantages that you can't eliminate. If you're using Google, you're one of a billion people using it, which means they have lots of data to help them determine the best results. Google has to take advantage of that in order to continue to grow their business. So that's their biggest challenge. Google is aware that switching costs are not large, so they better stay paranoid and they've done very well at staying paranoid.

NWW: What are Google's concerns going forward in the search market? How are their competitors differentiating themselves?

WA: There are a number of differentiation strategies but they all come down to delivering better approaches to search for different individuals. Microsoft right now is working hard to suggest that there are issues around the way that Google does business and suggesting that Google's search results aren't as good as you may think they are.

Another way is to differentiate based on your interface so you can tell users that they can find what they want easier with our search results set. You can also utilize different information, such as when Bing incorporated Facebook information into its results before Google could even incorporate Google+.

NWW: How does adding more direct answers fit in with this strategy?

WA: Answers aren't a new idea. The first time I saw answers was from Excite back in 1997. The idea behind it is to figure out what the consumer really wants. If they type in "Red Sox score" they'd rather see the Red Sox score. They don't need a list of Red Sox websites. That kind of direct information leverage is interesting and challenging. But information providers can get frustrated because they've given you a Red Sox score but you haven't clicked on their link and you're not viewing their ads.

NWW: What further changes do you see Google making?

WA: I think what we're going to see is the emphasis that Google has placed on Google+ to continue. That has potential for backlash if they emphasize it for too long, but the value of linking search and Google+ will be a very important direction for Google to grow.

What Google+ needs is a "FarmVille" or something that's going to get people to engage. Google hangouts are really cool but the killer thing isn't there yet. Once it's there the magnetic effect will kick in and Google+ will have its own identity. Remember, there were a lot of things that were like Facebook that existed before Facebook.

NWW: Is there something right now that no major search engine is providing that you think a young upstart search company could provide?

WA: I don't see it right now. I can't see something that another search company can do better right now that would lead everybody to it. Keep in mind, though, that I used to think we didn't need Google because I thought AltaVista was pretty good. But for the time being Google has the building blocks it needs to continue to consolidate its lead in search -- it has Google+, it has Maps, it has YouTube and it has Android.

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