New Media? The Political Economy of Internet Search Engines

This paper presents a structural analysis of the Internet search engine market. Search engines are a core element of the Internet media system, topping the Nielsen NetRatings Top 10 list of online properties in every market measured and generating advertising revenues of billions of dollars each year. Using a search engine is the most popular online activity after reading email. A political economy approach is used to identify the relevant parties in the system, their ownership, their exchanges, and the constraints to which they are subjected. The market is shown to be similar to other media markets in that it is both highly concentrated and global in scope, and funded primarily by advertising. However, there are several important differences. First, although traditional media conglomerates operate online, they do not control the most powerful actors such as Google and Yahoo!. Second, the advertising market is structured differently. Advertising is normally linked to words entered as search terms by users, and this keyword-based advertising is syndicated to other search engines, large and small, primarily by Google and Yahoo!-owned Overture, increasing their influence. Third, the situation is complicated by new commercial actors called search engine optimisation companies who operate within a grey market often in opposition to search engine companies, to strengthen the rank of their clients in search engine results. Recent studies within the computer science discipline have shown search engine results to be systematically biased in favour of commercial sites, popular sites, and US-based sites. With no public service mandate and little regulation, the study raises the question of whether the current system of search provision online serves the 'public good'.