LBi Search: LBi Search Newsletter: January 2009

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Acquisitions and Partnerships

Yahoo! announces new CEO

Carol Bartz is now the new CEO of Yahoo!. She spent 14 years as the CEO of Autodesk, a leading computer-aided design software company, before moving to Yahoo! in 2006. Jerry Yang has returned to his previous position of Chief Yahoo!, a title he shares with David Filo, another Yahoo! founder.

Microsoft announces partnerships with Dell and Verizon

From February, Dell will include Microsoft Live Search as the default search engine on the majority of consumer and small business PCs that they ship globally. The Live Search Toolbar will also be included. Dell is believed to be the biggest provider of PCs in the U.S. and the second biggest worldwide.

Microsoft also announced a mobile search and advertising deal with Verizon Wireless that will see Live Search included on mobiles for U.S. users, along with targeted advertising.

Yahoo! shuts down Content Match in the UK & Germany; end PDF contextual ads

Yahoo's contextual advertising network, Content Match, is to close in the UK and Germany. Subscribers received an email saying that Content Match will close on 31^st March. Yahoo! is also ending its Ads for Adobe PDF contextual advertising partnership with Adobe, which is set to close on the same date.

Google ends Print Ads

Google has announced that it will cease its print advertising from February 28^th and cease running ads from March 31^st. In the announcement, Google said: “It is clear that the current Print Ads product is not the right solution”.

Google Print Ads allowed advertisers to manage and execute advertising programmes in print media through an online interface. Google had managed to build up the programme to include over 800 U.S. newspapers.

Search News and Research

Google flags the entire Web as malware

Google suffered a rather embarrassing episode at the end of January when it accidentally flagged every page on the Web as malware. This completely blocked all normal searching activity and effectively “broke the internet” for Google's users. Although the episode only lasted for around an hour, it has been estimated to have cost Google $2-3 million.

Huge rise in Chinese internet users (Source: CINIC)

Research by the government-linked China Internet Network Information Centre (CINIC) claims that the number of internet users in China has expanded to 298 million, a rise of 41.9% from the previous year. The research also showed a big increase in mobile internet usage and highlighted the fact that growth in rural areas was faster than in the cities. This makes the online population of China almost the size of the entire population (online and offline) of the United States.

Free shipping an important incentive for U.S. online shoppers (comScore)

A recent report from comScore studied the effects of free shipping offers on the sales of U.S. internet retailers. The study tracked retail e-commerce spending for the first 44 days of the November/December 2008 holiday shopping season and found that free shipping was an important incentive for online consumers.

The study looked at a number of retailers who offered free shipping deals during the week ending November 30^th (Thanksgiving) and the following week (which includes “Cyber Monday” promotions). These retailers saw an increase in order values and positive spending growth when compared to the same period in 2007. However, when some retailers ended their free shipping deals during the week ending on the 14^th December, average order values declined and growth for that week was negative when compared with 2007.

Google PageRank Update

Google has updated the PageRank values which can be seen using the Google Toolbar (also known as “Toolbar PageRank”). This was the first update since September.

Please note that, although PageRank is calculated on a regular basis within Google itself, the PageRank values which are seen in the Google Toolbar are only updated about every 3-4 months. With this update, new PageRank values should be visible.

Google targeting “placeholder pages”

After Google sought feedback from webmasters on which areas of web spam to tackle in 2009, the response was overwhelmingly in favour of targeting “placeholder pages” (such as “empty review” pages, which are created when a website automatically generates pages of reviews for a product even when there are no reviews and which appear in the search results for searches for reviews of the product).

Such pages already contravene Google's Webmaster Guidelines, which state:

“Avoid publishing stubs: Users don't like seeing “empty” pages, so avoid placeholders where possible. For example, don't publish pages for which you don't yet have real content.”

Google is now stepping up its efforts against this particular form of web annoyance by requesting that users send in reports of such pages. Google is likely to use these reports in order to create new algorithms to combat this issue.

Updates at Yahoo! and Ask.com?

Early indications seem to indicate updates at two of the “big four” search engines, Yahoo! and Ask (formerly Ask Jeeves). This may result in the usual shuffling of results in these search engines.

Google's revenues better than expected

Google's total revenues in Q4 2008 were $5.7 billion, an increase of 24% from the same quarter in the previous year and better than most analysts' projections. Net income was $382, sharply down from the $1.21 billion in Q4 2007, although Google points out that this low figure is partially related to its investments in AOL and Clearwire.

New Product Launches

Encyclopaedia Britannica 2.0 allows users to edit it - Wikipedia to start checking edits before they go live?

The Encyclopaedia Britannica is moving to allow users to update its online edition. Encyclopaedia Britannica has been keen to stress that the scheme will not result in the same lack of credibility as popular Web 2.0 encyclopaedia Wikipedia, and that it will require certain expert contributors to verify any reader suggestions before they are accepted.

Interestingly, Wikipedia may begin to require a “trusted user” to verify edits before they go live for the English language edition. This system has been tried previously on the German language version of Wikipedia and led to three-week delays between editing and publication. Britannica is aiming for edits to be reviewed within 20 minutes, which seems rather ambitious in light of this.

Google finally adds support for Media RSS

Google has announced support for the Media RSS video syndication format. This is in addition to its support for its own Video Sitemaps format, which was previously the only method of submitting videos.

This announcement means that videos can be now submitted to Google, Yahoo! and Microsoft Live Search using the same syndication format, which will make it much simpler for users to get their videos widely distributed.

Search Industry Market Share Updates

U.S. Search Engine Market Share Updates [Hitwise/comScore]

Hitwise

Hitwise has released its U.S. search engine market share figures for December 2008. Google maintained its dominant position, with a slight growth in market share from 71.97% to 72.07%. This is a notable increase from a year ago, when its market share was 65.98% and represents an increase of slightly more than 6% year-on-year.

Yahoo! experienced a slight increase in market share in December, up 0.09% to 17.79%, but this is significantly lower than the 20.88% market share they had in December 2007. The picture for Microsoft Live Search is very much in the same pattern, with a slight increase from 5.45% to 5.56% market share being little consolation, considering the 7.04% market share they had at the end of 2007.

The market share of the dwindling fourth largest search engine, Ask, dropped from 3.35% to 3.15% in December, down from 4.14% at the end of 2007. Note: Hitwise data is based on volume of searches.

comScore

comScore has also released December 2008 market share figures for the U.S. market. Unlike the Hitwise data, comScore figures show an almost entirely unchanged picture when compared to the previous month. The figures show Google's market to be share static at 63.5% (a figure much lower than Hitwise shows), Yahoo!'s market share to have increased very slightly (by 0.1%) to reach a 20.5% market share and Microsoft's market share also remaining unchanged at 8.3% share. Ask's market share has dropped by 0.1% to 3.9% and AOL's remains static at 3.8%.

Note: Differences in statistics will inevitably arise due to different samples, sample sizes and methodology.

U.K. Search Engine Market Share Updates [comScore]

Hitwise has released its UK search engine market share data for December 2008. Google continues to hold both the number one position with its UK site (Google.co.uk) and the number two position with its worldwide (Google.com) domain. The figures show that Google.co.uk's market share has increased by around a quarter of one percent, rising from 75.76% market share to reach 76.0%. However, Google.com experienced an almost identical drop in market share, from 14.58% to 14.32%.

This suggests that, overall, Google's market share across these two sites is almost unchanged and that the changes reflect Google users switching to the UK-specific Google site from the general Google.com site, rather than switching to or from competitor search engines.

Moving on to the other search engines, Yahoo! is holding on to its number 3 position with a 2.76% market share for the site uk.search.yahoo.com, a small increase from the 2.75% market share that it had in November. The fourth most popular search site is still Microsoft's www.live.com, which has experienced a somewhat larger drop in market share since December than to Yahoo!, down from a 2.09% market share to 2.01% in January.

Web Browser Market Share Updates [Net Applications]

Web browsers

A recent report on web browser market share by Net Applications includes some interesting findings. Microsoft's dominant Internet Explorer browser has continued its downward slide with its overall market share dropping to a 67.55%, a decrease from 68.15% the month before and a big drop from the 90%+ market share it has held in the past. Whether the impending release of Microsoft Internet Explorer 8 will do anything to halt Microsoft's ongoing falls in web browser market share has yet to be seen.

Upstart browser Mozilla Firefox has continued its gradual rise in market share and reached a 21.53% share of the market in January (up slightly from 21.34% in December and having increased considerably during the past 12 months). However, most eyes will be on Apple's Safari browser, which has continued its unusually strong gains in market share in December, reaching an 8.29% market share in January 2009 and heading towards doubling the 5.82% market share that it held in January the year 2008.

Also of note is the progress being made by Google's relatively new web browser, Google Chrome, which passed the 1% market share milestone for the first time since the initial interest around its launch in September, and which has continued to gain market share in January 2009 (increasing to 1.12%). Lastly, these figures seem to show that longstanding alternative browser Opera has seen growth almost stagnate, and its market share is currently only around 0.7%.

Operating systems

Net Applications has also reported on Operating System online market share (that is, the Operating Systems used by web users). Microsoft Windows has been steadily dropping in market share over the last year, dropping to 88.26% for the month of January 2009.

The main beneficiary has been Apple's OS X operating system, which reached a new high of 9.93% market share in January 2009, improving upon the significant jump in market share that it experienced the month before. Linux's market share has stabilised after gains made in 2008, and it currently has an online market share of about 0.83%. Also of note is iPhone usage, the figures for which Net Applications has separated from the main Mac figures. The iPhone's market share has increased almost constantly over 2008 and it reached a new high of 0.48% in January 2009.

Please note that figures may vary widely based on factors such as the methodology used, sample size and sample bias. In particular, the actual market share of 'alternative' browsers and operating systems is often higher than measured due to, for example, users of these alternative systems masquerading their platforms as more mainstream browsers in order to improve compatibility.