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Google (NASDAQ:GOOG), one of the tech sphere's great success stories of the last 10 years, has suffered a blip recently. The stock, which has consistently risen, gaining 50% in value in the last 12 months, has taken a downturn in recent weeks. Market experts are trying to assess if this is a blip, brought on by conservative assessors looking to sell at the perfect time, or something more serious.

Google's share price has dipped recently following its announcement of a new dual class share structure, which has not sat well with shareholders, but the world's most used search engine still holds a healthy market position, currently steady at around $615.

Over the horizon, however, I sense that there may be more serious concerns for the company. Its near total domination of the internet search market is under threat from an illustrious rival set to take the market by storm next month - Facebook (NASDAQ:FB). The social media site, best known for providing online interaction with friends and family, has taken an unexpected bite out of Google's market in recent months. Increasing numbers of internet users have started searching the web through Facebook, and the site has quickly added new applications to take advantage.

Facebook's new social reader application allows users to post stories from across the web, which they access through Facebook. It is thought that the use of these applications will cause Facebook users, who number close to a billion, to begin using the internet from entirely within Facebook sites and applications.

This is known as a 'walled garden,' and Google could find itself suddenly, unexpectedly on the outside, looking in. Facebook is used extensively across the developing world - its top 10 countries by user numbers include India, Indonesia, and the Philippines. If the millions of users who currently favor Facebook across the world are able to search the internet effectively without stepping outside the site, the repercussions for Google could be disastrous.

Where does that leave Google's stock prospects? In the short term, there's no need for panic. Google is comfortably the market leader among search engines, and is continually innovating through new products like Google+ and the acquisition of YouTube. In short, the tech giant has a long way to fall.

My gut feeling is that there has been room in the marketplace for Google and Facebook for some time, and that, initially at least, there will be room on the exchanges for both. Facebook's expected flotation next month looks likely to be a big success, but there's little reason to expect this will directly harm Google's position. In this field at least, the search engine has a big head start. Smaller companies like Yahoo! (NASDAQ:YHOO) may be at greater risk if tech-savvy investors decide to back Facebook in a big way.

Google's rivals get smart to gain advantage

Experts have long predicted that the rise of social media sites and an increase in censorship would lead to a 'walled garden' style internet, where traffic is focused through a few key sites. This strategy played into Google's hands initially, as it filled the gap for a dominant, go-to search engine, and exploiting its position to maximize advertising revenue. One aspect of this trend that was largely unseen by experts was the rise in the use of smartphones. These new, feature heavy phones accounted for over 50% of internet access last year.

This means that, incredibly enough, personal computers are globally no longer the primary means through which to access the internet. Smartphones and tablets, envisaged as accompaniments to the traditional PC, may one day usurp them entirely.

In an internet driven technological age, they have made PC software companies like Microsoft (NASDAQ:MSFT), the original tech stock market crusader, and hardware manufacturers like Intel (NASDAQ:INTC) may continue to struggle in attracting value. Losing ground in the race for control of the internet may cause traditional companies to lose the 'wow' factor, but I can't foresee major losses in either company's stock value in the short to medium term.

The evolution of smartphones and the burgeoning 'walled garden' internet age may create a perfect storm for Facebook. Smartphones actually limit the way in which the internet can be accessed, with applications and manufacturers' browsers providing a limited but up-to-date online experience that seems to be more than sufficient for most casual browsers.

This is an arena where Google is well placed, on account of its impressive forays into the smartphone market, via its Android operating system. In the next online era, large search engines and social media sites may find that, rather than drawing traffic in, they are funneling millions, maybe billions, of internet users towards selected corners of the internet.

The additional earning power through advertising and new contracts is immense, but the uncertainty has created a stock market wobble for Google. I would advise you to keep hold of your stock - the company are well placed to take advantage of changes in the way the world browses the web, even if it doesn't appear to be at the head of the queue.

One company that appears to have all bases covered for whichever way the wind turns is Apple (NASDAQ:AAPL). The giants of the computer industry, who went from chasing a distant Microsoft to possessing a turnover larger than the entire United States GDP, have thrived on successful, innovative ideas. Its hefty presence in both the smartphone and tablet market, and the world of home computing, means it is hard to envision a situation where this giant could run aground. Its stock currently sits at just over $600, having grown relentlessly in value for the last 10 years.

Much like Google, it has taken a glancing blow in the recent uncertainty over developments in the digital world. An ongoing lawsuit with the U.S. Government and rumors of a new, affordable iPad have led some investors to quit while they are ahead. I wouldn't be trading at this time. Apple appears to have such significant market penetration that even in a tumultuous market, it's as close as you'll get to a sure thing. That said, many would have claimed the same of Google not so long ago. Now, I'm not so sure.

Source: Tech Giants Eyeing Google's Social Media Market Share