Joel Sutherland

Yahoo Loses as Google Moves Search to the Toolbar

Over the summer, Microsoft attempted to purchase Yahoo as a move to stay relevant in search. However, I predict that over the next couple of years, Yahoo will continue to lose ground to MSN Live and Google. Unlike the other two search engines, Yahoo is not a default toolbar search option in any major browser.

The current marketshare of the three browsers are (July Neilson/NetRatings):

  • Google - 59%
  • Yahoo - 17% 
  • MSN - 14%
That Google dominates search is common knowledge.  How Google dominates, however, is quite interesting.  Consider the traffic that each of the domains receives:

Given roughly equal traffic between google.com and yahoo.com, Google manages over three times the search share.  MSN with far less web traffic generates nearly the same search volume.

Google realizes that it can squeeze Yahoo out of search by making the toolbar more important.  This is why Chrome doesn't even have a homepage by default.  Instead it took speed dial from Opera.

Google didn't try to use a default homepage as others have done in the past.  Users have learned to switch their homepage over the years after doing multiple browser updates and purchasing new computers with HP or Dell branded homepages.  Instead, Google dropped the notion of a homepage altogether, uniquely targeting Yahoo's biggest source of search traffic.

You might say that Chrome has such small marketshare that this change is insignificant, and you would be right.  But as we have seen before, Google can be a trendsetter.  If the speed dial takes off, Yahoo is in no position to recover.