Saturday, October 13, 2012

Why The Google Era May Be Over - Business Insider

Something crucial happened last month that no one seems to be paying attention to.

People searched less.

That's never happened before.

Ben Schachter of Macquarie Securities noted this in a research note:

Notably, total core organic searches declined 4 percent y/y, representing the first decline in total search volume since we began tracking the data in 2006. While this month marks the first y/y decline in total search volume, growth rates have been decelerating since February's recent peak at 14 percent y/y growth (for the prior two years, growth rates were largely stable in the high single-digit to low double-digit range).

Tech insiders have been predicting this would happen for some time, as people shifted from using websites, where search is a natural activity, to using mobile apps. No less a luminary than Steve Jobs made this prediction in 2010 at the D8 conference:

We discovered something?people are going into apps. They?re not just going onto to websites. And people love apps. This is an entirely new thing?they aren?t using search, they?re using apps like Yelp.

That's terrible for Yahoo, which depends on search for most of its profits and, having handed most of its back-end search technology over to Microsoft, has precious little leverage to restore its momentum.

It's also horrible news for Microsoft, which continues to spend and lose billions of dollars to catch up with Google in a market that, it turns out, just peaked.

It's fantastic for Apple, of course, which doesn't have a stake in the search business but has a lock on most of the profits in the app economy.

It's also good for players like Amazon, Yelp, and eBay, which handle specialized kinds of commercial searches that work well when packaged into a mobile app.

Google is not as bad off as it might seem. Yes, most of its business is built around search. But it has its own mobile ecosystem in Android, so it's positioned to capture consumers as they shift from searching on the Web to using specialized apps to express and fulfill their desires. And with YouTube and Google+, it has strong social properties that don't depend on search.

Twitter will continue to benefit from its unique ability to deliver timely content that doesn't show up in conventional searches.

And Facebook, which admits it hasn't really bothered to pursue the search opportunity, might still do something interesting. Or it might look at search and realize that it's ultimately a declining business.

Source: http://www.businessinsider.com/peak-search-google-search-query-decline-2012-10

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