This time it’s analyst Charlene Li, whose commentary runs on CNET today. In the piece she gives a fine overview of Google’s weaknesses vis-a-vis MSN, Yahoo, and presumably AOL. Her overview is good, but I disagree with some of her conclusions.
In summary, she argues that Google can’t compete with the portals search offerings, in particular once the portals have integrated search across their sites. Portals, Li argues, are in the best position to incorporate personalization, contextual searching (ie a search for “price delta” within Yahoo Travel yields different results from the same search within Yahoo Finance) and the like. Li further points out that when MSFT integrates search into the desktop qua Windows, Google will really be hard pressed to compete.
Li concludes that Google’s only true advantage lies in its independence as a non-publisher: In a choice between Yahoo, which competes at multiple levels with publishers, or Google, which is focused solely on search, publishers have and will continue to sign up with Google in droves. As contextual marketing makes inroads, Google will evolve its ad network into utilities that will enable the contextual placement of display ads–and siphon a portion of traditional branding ad dollars away from the portals.
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