Google Too Big?
July 15th, 2009 by Collarity
This week, Techcrunch published a lightning-rod-post crying for more disclosure/transparency from Google (irony = post is signed by anonymous “guest author”) and asks whether Google’s market dominance should be regulated (The Time Has Come To Regulate Search Engine Marketing And SEO). We at Collarity feel that while Google may be an overwhelming influencer in the ecosystem (essentially creating it), it is “early days” in the world of search (and paid search advertising) and the mechanics of normalizing access is better served by the competitive market.
According to Comscore, Google’s query market share (driven by consumers) stands at 65% and its paid search market (driven by advertisers) share has risen to 77%. Normally, you would expect those percentages to be roughly equal and this frustrates paid search competitors. This skewed ratio is evidence that advertisers favor Google – probably because of its market share. Additional transparency will level these figures over time. Advertisers will eventually demand more accountability and visibility into how their dollars are being spent and the market will gravitate toward the players who provide more of these details. Moreover, the market will rationalize and budgets will flow until the system gets to an equilibrium determined by the ROI achieved, with budgets allocated between different Ad Networks.