Google Loses Search Traffic to Yahoo and Bing: Analysis

Google Loses Search Traffic to Yahoo and Bing: Analysis
Search engine Google lost a little ground in search engine traffic in June to both Yahoo and Microsoft sites, but the tech behemoth has nowhere to go but down.

Google has a market share of 62.6 percent, down from 63.7 in May, according to Comscore. Both Yahoo and Microsoft's sites including its flagship search tool, Bing, saw gains, each increasing their numbers from 18.3 to 18.9 percent and 12.1 to 12.7 percent, respectively, from May to June. Yet all three search engines experienced growth year over year, with Bing leading the pack at 77 percent volume growth last year. Google grew 12.7 percent.

As numbers go, the data isn't amazingly good or bad, it's simply pointing out the fact that when a company holds the majority of anything -- be it fast-food restaurants or search engines -- it is in danger of losing its hold on the market. At close to 63 percent, Google is the undisputed leader in search engine traffic, but with about 10 years on the scene it's likely at saturation point -- or it has as many users as it's going to get unless something revolutionary happens. Microsoft's Bing, a newcomer which uses the computational search tool Wolfram Alpha, is an antidote to Google's all-seeing algorithm. Refining search results doesn't seem to be Google's strong suit.

Bing also has plenty of money behind it to keep at Google's heels. Microsoft's Steve Ballmer stated in 2008 that his company is dedicating five years to building a better site.

The company told its shareholders recently that it was prepared to lose "5 to 10 percent of total operating income for several years" to improve its position in search, Ballmer said.

And since Microsoft started with a smaller market share it's easy to show a percentage rise quickly, any rise from 62.6 percent is likely to be a small in comparison. Yahoo, which still holds onto almost 19 percent of market share, has dropped from around 23 percent in 2007, but still apparently has some loyal users. (You can argue that both Microsoft and Yahoo are benefitting from Bing, since Yahoo now uses Bing to power its search.)

Both Bing and Yahoo are gaming the system a little by supplying extra links that count in its click total:

UBS analysts Brian Pitz and Brian Fitzgerald note that a big driver for the market share gains at Yahoo and Bing were the use of contextual searches - searches tied to slide shows and other material in which the search results are offered without specifically being requested. Excluding contextually driven searches, the UBS analysts note, Yahoo gained 10 basis points of market share, and Microsoft 20 basis points.

Comscore reported it will retool how it compiles data to exclude contextually-driven searches in August. Also since both are content sites with both original and user-generated material to read, watch or comment on, comparing the two with Google isn't quite the same, either. True, Google News is one of the most well-known news aggregators, but it takes pride in saying it will never be a media producer.

Google will likely lead Internet searches for the rest of the decade or until users want a different experience in a search. But expect that to happen only at a fraction of a percent at a time.

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