Changes in technology and consumer behavior make this the perfect moment for companies that want to challenge Google’s dominant market position.
Google’s loss in its federal antitrust case may mean huge changes for the company, web users and digital advertisers. It could result in a big hit to parent company Alphabet’s bottom line; more and better search choices for people; and lower-priced, more effective advertising.
We won’t know until U.S. District Judge Amit Mehta hands down the penalties in a few months. However, Google has said it will appeal the ruling, so it will likely be years before anyone knows for certain how everything will fall out.
That said, the ruling comes at a good moment for competitors. Thanks to changes in consumers’ online behavior, people are getting used to using things other than Google.
“People no longer rely on just one source,” Marcel Hollerbach, chief innovation officer at product-to-consumer company Productsup, told MarTech “Depending on what you need, you might head straight to Amazon for a last-minute phone charger for an upcoming trip, browse TikTok for recipe ideas for an upcoming dinner party, visit Reddit for engineering advice, or turn to ChatGPT for help with asking for a raise.”
AI-powered search
Combine that with the new types of AI-powered search, and it’s easy to see how there could be a real challenge to Google’s dominance for the first time.
“This has happened at a perfect time for their competitors because you’ve got OpenAI, you’ve got Microsoft and the fundamentally different conversational search underpinned by AI, which I think completely transforms the consumer experience,” Amelia Waddington, chief product officer for search intelligence vendor Captify, told MarTech.
Google’s own efforts with generative search have shown it isn’t yet ready for prime time. However, with companies like OpenAI and Microsoft also developing versions, likely someone will soon get it right.
“As AI-powered search technologies (like Search GPT) emerge, this ruling could lead to new solutions that pair speed, ease of use, and privacy protections that ultimately put Google on its heels,” Lance Wolder, head of strategy and marketing for digital media agency PadSquad, told MarTech. “This ruling … presents an opportunity for privacy-first engines (like DuckDuckGo and Brave) to go on the offensive to gain traction, potentially becoming the default options on devices or platforms.”
Solution needs to be more than more choices
Any remedy that seeks to create a level playing field for text search would have to do more than end Google’s ability to be the default search engine for Apple, Android and Firefox. The fact that we use the verb “to Google” demonstrates the company’s dominant position with the public.
Google’s browser Chrome is similarly dominant, something it’s difficult to see changing any time soon.
“Is there a current browser whose functionality right now could suddenly take over here?” said Waddington. “There has to be a compelling reason why, and I don’t I don’t see that in other browsers. And the prices that Google can charge for their search-based advertising, that’s entirely based on the percentage of market share they have. Right?”
Even with more choices offered, user inertia alone would leave Google and Chrome with enormous market share. So the company could still charge what it wanted for search ads. One possible solution for that would be to have the company sell off Chrome and perhaps prevent Google from being a default search choice for some time.
Breaking up may be good to do
“One of Google’s biggest advantages in the AI market is its ability to integrate the technology across its various services seamlessly,” said Hollerbach. “The same goes for Microsoft or Amazon. If we were to see any parts of these businesses split, it could pave the way for other ‘best of breed’ AI players to rise up.”
Whatever the final decision in the case turns out to be, it will likely cause problems for other companies and digital advertisers.
“In addition to diversifying SEO and SEM strategies, organizations may experience even more disruption in digital advertising performance as the flow of data about user interests and behaviors becomes more fragmented and scrutinized,” said Andrew Frank, distinguished VP Analyst in Gartner’s Marketing Practice.
While no one is worried about Apple’s survival, the deal that made Google the default search choice on its devices and browser brought in $ 18 billion last year. Samsung will also take a financial hit for similar reasons.
The organization that would take the biggest hit from ending its default search deal with Google is the non-profit Mozilla. The maker of the Firefox browser got $ 510 million from Google out of $ 593 million total revenue in 2021-2022, according to its latest financial report.
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