I. Industry AnalysisCompetitionThe web search industry is characterized primarily by an oligopolistic competition within Google, bumpkin, Microsoft, and AOL. The Big 4 serve the sinless market and divvy up similar basic infrastructures and activities. So they fight in such segments as market share, technology and methods used, revenue, and share price.
oHigh barriers to entry. Consolidated market with the high amount of R& group A;D required.
oCompetition mainly on market share (differentiated product)oGoogle?s website, Google.com had a 37% share of all U.S. searches in Q3 2005, Yahoo.com, its close rival, had a 30% share.
oLeveraging its own concern and that of AOL, Ask.com, and other affiliates, Google garnered close to 60% of U.S. search-related advertising revenue in 2005.
oOutside the United States, Google.com held a commanding 68% share of all search traffic in Q3 2005.
oIn June 2000, one year after it was founded, Google?s powerfulness of 1 billion web pages surpassed those of its rivals.
oIn 2000, Google replaced Inktomi as Yahoo?s search engine.
oMicrosoft was threatened by Google?s ad-supported software system.
oIn 2005, Microsoft responded to Google?s ad-supported software threat by proposing a joint venture with AOL to spud search related advertising.
oHigh customer loyaltyoSee Exhibit x for enlarge competition profile among the big playersProductsGoogle?s range of products render speculation about Google?s strategic objectives.
oGoogle had launched a discombobulate of products that had expanded its domain beyond web search including Gmail, Google Desktop, Google Maps, Google check Search, and Google Talk.
oProducts like Talk and Gmail, along with personalization features offered on Google?s hearth page, moved the company further into the domain of portals like Yahoo!
And Microsoft?s MSN.
oBase, Book Search, and Maps along with a payment avail acknowledged to be under development, suggested that Google could be targeting e-commerce giants like eBay and Amazon.
oGoogle?s ad-supported software and rumored web-based products...
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