), which competes with Microsoft (
), Yahoo (
), AOL (
) and Facebook in the search advertising market, has been
working to increase its penetration in social networking. It
started with Google's foray into social applications like Google
Wave and Buzz, which did not meet initial expectations. Google then
made a number of acquisitions for the development of its major
upcoming social networking project named Google Me.
Now, Google has modified the incorporation of social search
results to make them appear more prominently in Google search.
Google originally began incorporating social search results within
traditional Google search in 2009, but those results were relegated
to the bottom of the page.
One of Google's more prominent competitors, Microsoft Bing, has
also begun an aggressive push into this market. Below we analyze
Google's initiatives to grab a share of this market, and highlight
a key metric to observe regarding outlook for the company's
We currently maintain a
price estimate for Google stock, which is about 5% below market
Google Making Moves in Social Search
The major threats to Google in the search advertising
market are likely to be Microsoft and Facebook. While Google
is still the dominant player in the search advertising market, with
a share of around 68%, both Microsoft and Facebook have also
increased their market shares, mainly at the expense of Yahoo and
See the complete $603 Trefis Price estimate
for Google stock
A few months back, Microsoft partnered with Facebook to
incorporate more personalized results and leverage Facebook's
substantial base of 500 million users (see:
Social Search with Bing-Facebook Combo a Threat to
). However, with the recent social search update, Google has woken
up to the fact that it needs to do more in the social search market
to compete against the Microsoft-Facebook combo.
Google's new social search functionality integrates information
from Twitter, Flickr and Quora within the traditional search
results. Additionally, new privacy settings will allow users to
determine and adjust the link between their Google account and
social media profiles.
Google has been trying to tap the fast growing social networking
market despite perceived failure of its projects Buzz and Wave.
Google is likely to launch Google Me during 2011, and made a number
of acquisitions in 2010 for the the project's development. These
acquisitions include Jambool (a social gaming site), Metaweb (a
semantic search engine), and Angstro (a social networking startup
that pulls data from Facebook, Twitter, LinkedIn, etc).
Will these initiatives drive a pickup in Google's search market
share? Drag the trend line in the interactive chart above to see
the affect of various market share scenarios on Google's stock