Google’s search dominance is unwinding

Analysis by David Goldman, CNN

New York (CNN) — Google is so synonymous with its core product that its name is a verb that means “search.” Yet Google’s dominance of that market is shrinking.

For the first time in decades, Google next year will not control a majority of the US search market, according to a forecast by advertising research firm eMarketer.

Google will remain the biggest search player, maintaining a 48% share of American search advertising revenue. And Google is still growing its sales in the space, amazingly, considering it has been dominant in search since the early days of the George W. Bush administration. But Amazon is growing faster.

Amazon next year will control nearly a quarter of US search ad dollars — a figure that will grow to 27% in 2026, while Google slips even further, eMarketer predicted.

The forecast was first reported by the Wall Street Journal.

Lest you fear you’ll have to start using Bing or Yahoo, this isn’t the end of Google or anything remotely close to it.

Google is the fourth-most-valuable public company on the planet. At $2.1 trillion, its market value trails only Apple, Microsoft and AI chip darling Nvidia. And it remains dominant in other markets, including display ads, which it leads alongside Facebook’s parent company Meta, and video ads through YouTube.

To put those “other” businesses in perspective, each on its own is larger the the entire market value of Delta Air Lines. So, yeah, Google’s not going anywhere.

Still, Google is facing multiple threats to its business, particularly from antitrust regulators.

On Monday, a federal judge in San Francisco ruled that Google must open up its Google Play Store to competitors — a huge blow to the company in its long-running battle with Fortnite maker Epic Games. Google said it would appeal the ruling.

The company lost another ruling in August, when a federal judge found Google is operating an illegal monopoly in search. That ruling could result in the eventual breakup of the company’s search business. Another antitrust fight that began last month accuses Google of abusing its dominance in the online advertising market.

Meanwhile, European regulators have forced Google to comply with strict new rules, violations of which have resulted in multiple $1 billion-plus fines.

On top of all of that, the marketplace is becoming increasingly challenging on its own.

TikTok, the fastest growing social network, is getting into into the search business. And Amazon has done something few other tech giants have managed up to this point: create a habit.

When you want to buy something, you typically go to Amazon — not Google. Amazon then sells ads to elevate companies’ products up to the top of your search results, giving those products a sales boost — and giving Amazon a growing chunk of change. In the United States alone, it’s forecast to bring in $27.8 billion in search revenue next year, second only to Google’s $62.9 billion, according to eMarketer.

And then there’s AI, the tech that’s (allegedly) going to upend everything.

Why search in stilted language, “kendall jenner why bad bunny breakup” or “police moving violation driver rights no stop sign” when you can just talk to OpenAI’s ChatGPT and ask, “What’s going on with Kendall Jenner and Bad Bunny?” or “I need help fighting a moving violation involving a stop sign that wasn’t visible.” Google is working on exactly this technology with its Gemini product, but its success is by no means secured — especially with Apple partnering with OpenAI and other companies quickly entering the market.

A Google spokesperson pointed to a company blog post last week in which it announced ads in its AI overviews (those bits of AI-generated text that show up at the top of search results). It’s Google’s way of saying it can capitalize on a changing marketplace, maintaining its business, even as its customers gradually shift to ask-and-answer AI and away from search.

Google has long defended itself against critics who say it’s a monopoly in abuse of its power with a single catchy phrase: Competition is one click away. Until recently, that’s felt laughably obtuse. Really? We’re going to switch to Bing? Or Duck Duck Go? Give me a break.

But today, that feels closer to reality.

Google’s in no threat of vanishing. But all massively dominant companies have a reckoning of some sort over time. GE, a Dow mainstay for more than a century, broke up last year and is a shell of its former dominant self. Sears went bankrupt in 2022 and is practically out of business. US Steel, once the backbone of American industry, is trying to sell itself to a Japanese company.

Decades from now, could we look back at Google the way we do Yahoo or Ask Jeeves? These next few years may be crucial.

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