| Abstract: |
Internet search (or perhaps more accurately `web-search') has grown
exponentially over the last decade at an even more rapid rate than the
Internet itself. Starting from nothing in the 1990s, today search is a
multi-billion dollar business. Search engine providers such as Google and
Yahoo! have become household names, and the use of a search engine, like use
of the Web, is now a part of everyday life. The rapid growth of online search
and its growing centrality to the ecology of the Internet raise a variety of
questions for economists to answer. Why is the search engine market so
concentrated and will it evolve towards monopoly? What are the implications of
this concentration for different `participants' (consumers, search engines,
advertisers)? Does the fact that search engines act as `information
gatekeepers', determining, in effect, what can be found on the web, mean that
search deserves particularly close attention from policy-makers? This paper
supplies empirical and theoretical material with which to examine many of
these questions. In particular, we (a) show that the already large levels of
concentration are likely to continue (b) identify the consequences, negative
and positive, of this outcome (c) discuss the possible regulatory
interventions that policy-makers could utilize to address these. |