January Search Market: Google Still Far Far Ahead

Unless you were sleeping under a rock you probably heard the big search news last week, and I’m not talking about Google (GOOG) posting record search numbers again in January. It’s hard to look at the potential merger of Yahoo! (YHOO) and Microsoft (MSFT) in the vacuum of search. The impact on the display advertising space is far more substantial but I would definitely be remiss not to mention a few points of interest on the search side. The combined search market share of Yahoo! and MSN/Live would come in roughly around the 25% mark among the U.S. online population.

You have to put this in perspective though. A year ago this merger would have meant a combined market share of nearly 32% vs. Google’s January 2006 share of 62%. With all the rumors about this merger being in the works for over a year, if not longer, you have to wonder who’s taking it on the chin by sitting on this one. It certainly isn’t Google. MSN/Live has definitely been gaining some ground in recent months but Yahoo! has yet to stem the receding tide. I don’t see the combined forces of these two reversing the current trend. Of course with the amount of buzz surrounding the potential merger and the coincident news regarding Google’s slide in the markets we may see some interesting numbers for February.

Oh yeah … by the way … Google’s market share reached a record level again in January.

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Remember January 2006? It was a tough month for almost everyone other than the big dog. Well the good news about bad months in history is that the bar is lower for the future. January 2007 was much kinder to almost all of the major search engines. Relative to year ago market share levels everyone except Yahoo! was either above or at par in January 2007. Month-over-month there was actually very little movement in market share. Almost everyone moved with the market as overall search query volume increased 5% from December. Google was biggest gainer on market share, but Yahoo!, IAC's (IACI) Ask, and Time Warner's (TWX) AOL all posted volume gains in January. MSN/ Live volume essentially remained flat month-over-month. It will be interesting to see if the buzz drives any curiosity to Yahoo! or Live search in February.

The overview…

• Google gained volume and share, posting a new record of nearly 69% market share
• Despite volume growth Yahoo! market share decreased slightly from December
• MSN/Live market share declined slightly with volume essentially remaining flat
• Ask market share ticked up once more on strong query volume growth
• AOL market share held steady despite strong volume growth
• The volume of RSS feeds in my feed reader with the word Microhoo! in the title has declined 5,000% since last Friday

* Search market share includes web search only and is calculated based on unique queries within each session during the given month.