Is google the next microsoft: Competition, welfare and regulation in online search

Abstract

The rapid growth of online search and its centrality to the ecology of the Internet pose important questions: why is the search engine market so concentrated, and will it evolve towards monopoly? What implications does this concentration have for consumers, search engines, and advertisers? Does search require regulation, and, if so, in what form? This paper supplies empirical and theoretical material with which to examine 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; and (c) discuss the regulatory interventions that policy-makers could use to address these. © 2010 Berkeley Electronic Press. All rights reserved.