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Search Engines Future Forecast - SEO or PPC?
By Andrew Gerhart - December 06, 2001

I have heard a lot of discussions, rumors, and theories of how in the future the majority of the big-player search engines will all turn to a pay-per-click (PPC) model. This has many people and professionals with the SEO industry worried. Some company execs, management, and directors have also been getting worried over their current SEO investments, or the investments that they are about to make. It has even reached the point where I heard of a company that is so worried that they have ceased their SEO operations and directed their strategy towards the PPC market. I think that these assumptions and forecasts are off target and pessimistic. Throughout this article I will give reasons and explanations to dispel these theories and forecasts that are causing turbulence throughout the Internet community.

The first and most obvious issue that arises about all search engines turning to PPC is the general rules of business. For a business to be truly successful is has to offer a product or service that is unique, superior, and desirable. For a product or service to be unique it does not have to be completely different, but it must have some unique distinction over the competition that makes it more desirable. For example, Google is a search engine with the service of providing users with search results. Google's service is unique because it provides users with more relevant results as well as added functionality that are unmatched on the Internet. In turn, this makes their service superior to the competition, and again in turn more desirable.

There are already a number of PPC search engines that are on the Internet. Out of these search engines there is only one that is highly successful, Overture.com. If the majority of search engines were to change their service as well as their business model to PPC, they would not only have to offer something that Overture currently doesn't, but there would be very little room for differentiation. If there is very little room for differentiation than there is very little room for success. One of the reasons that search engines like Google, Fast/AllTheWeb, and Wisenut can provide such relevant and good results to their users is because they will index all pages, regardless of payment and money. What is going to happen to the educational, non-profit, or small business sites that cannot afford to pay lots of money to be found. If they have the most relevant results, shouldn't' their site be pulled up? The answer is obviously yes.

When Alta Vista offered a paid submission, and inadvertently demanded it, as your site will not show up for months without paying, did Google, ODP, Northern Light, and WiseNut follow their lead? No, because there is differentiation between two companies, their business models, business plans, and strategies and goals. The way that they measure success is also different. This applies to this theory that all search engines that wish to be profitable and successful. Yahoo! has recently partnered with Overture to place Overture listings on Yahoo's search engine results pages. When someone performs a search, in most cases there will be three paid listings at the top above all of the Yahoo results, and three Overture listings at the bottom of the Yahoo listings. Should all of the search engines follow Yahoo's lead and begin to bring PPC into their model for profitability. No!

Let's go through an example. A search engine has a strong business model, a large database, a large user base, and most importantly, quality results. If the search engine has a decent hold on the market, there are two ways to go: up to the top, or down and out of existence. If the search engine makes positive changes to their engine, gets market branding, and increases their user base while keeping them happy, then they will move up to the top. If the search engine becomes stale, making no changes except for charging more money for submissions, while it's hold on the market decreases, then the site will fall out of the race and out of existence. If the latter happens to a search engine, do you think that turning to PPC will bring it back from the dead? Not likely.

Does this scenario sound familiar? This is almost a detailed explanation of what happened to Alta Vista (AV). Alta Vista was one of the biggest search engines on the Internet a few years back. It had a huge user base, it was spidering and updating its content regularly, and it had a partnership with Yahoo!. The partnership with Yahoo failed, the updating of the content all but stopped, and the user base began to dwindle. Alta Vista then began to offer paid submissions that would pave the way for faster indexing, but this became mandatory to see results in AV as websites that did not pay for submission were buried in the results pages. The only thing that stayed consistent was AV's spidering of the websites, although this didn't mean that sites would be updated or show in the search results. Word Tracker reports that Altavista only gets 3.1800% of all search engine traffic (approx. 10 million a day). Compare this to Google who reportedly gets 23.4800% of all search engine traffic (approx. 75 million a day), or Yahoo who gets 37.7600% of all search engine traffic (approx. 121 million a day).

When Alta Vista's foothold on the search engine industry began to slip they made attempts to remedy the situation and gain the competitive edge back. Although this has not worked yet, their hold could be easily regained with some positive change implemented.

The answer to a search engine's problem is not to increase the number of ways you can charge webmasters for submitting the websites that are building your business and database. This seems to be the way out for some search engines, including AV who now has over 5 ways a webmaster can pay for their results. Alta Vista now offers Express Inclusion, Trusted Feed, Listing Enhancements, advertisements displayed on the search results pages, as well as the Overture listings displayed on the top of search results. With all of these ways of to pay, AV is leaving out the small-business, non-profit organizations, and reference and research sites that Overture does. Where are the relevant search results?

I am in no way declaring that PPC is bad and has no place on the Internet, but there are some things that PPC search engines are for and some things that it should leave to engines like Google and AllTheWeb. A PPC search engine is good for an e-commerce website, as they can buy a spot at the top, see how many times the search is performed, how many times the link is clicked, track how many times the user buys the product, and then figure out what the return on investment (ROI) is. When someone uses Overture, in most cases they are searching for a particular product or service. Overture is not the search engine that most of the Internet population uses for their research.

The major players (search engines and directories) on the Internet, when speaking in terms of amount of traffic, are Google, Yahoo, AOL, and MSN. The other search engines that are up and coming are Fast/AllTheWeb, WiseNut, and Teoma. WiseNut is new to the game, but they have a strong business model and a strong search engine with a large database. WiseNut also provides good, relevant results to their users. Teoma is another one of the search engines that is new to the game. They are still in the Beta version, and have been acquired by AskJeeves, but they have potential to stand with the big-boys. Fast/AllTheWeb has emerged as one of the big players and is now a potential direct contender with Google. Fast/AllTheWeb has added functionality that poises the search engine to play "king of the mountain" with Google. The search engine recently added their "Fresh News Search" which gives you up to date news results that the Fast/AllTheWeb updates fast and often. All three of these search engines could easily emerge as the next Search Giant if one of the current ones decides to fall to the allure of PPC.