IOT5028-SEM1-A: Creativity, Innovation and New Digital Technologies

The Edward de Bono Institute for the Design and Development of Thinking
University of Malta

Course-week 5, November 2010

Evolution of search engines

Authors:
Kanika Karvinkop 0900045
Stephanie Seychell 98688
Lisa Wambach 1001403
The evolution of web search engines
With an estimated 124 million websites on the Internet today (Domain Tools LLC 2010), web
search engines are crucial to browsing for web-content. What has started in the early nineties as
FTP and Gopher “plain text search” has developed into sophisticated queries using web-spiders
and indexing (Meghabghab and Kandel 2008). The web search has turned form a simple tool of
information retrieval into almost indispensable means for marketing management.

The following analysis demonstrates how different ICT strategies, or the lack thereof, have been
employed during the evolution of web search engines, transforming them into the “doorway” to
the Web.

1. Lock-in and switching costs
A vendor or system lock-in makes users
dependent on the seller or system for a
specific product or service, and impedes the
switching to another product; changing the
system of vendor in case of a lock-in entails
high switching costs.
When launching its search engine, low
switching costs most certainly helped Google
to grow rapidly. Users compared its results
with results from other search engines (mainly
AltaVista, Lycos, Excite and Inktomi) and
switched to Google, as it showed more
“organic” search results.

Shapiro and Varian defined the lock-in in their
book “Information Rules”:
“Customer lock-in is the norm in the
information economy, because information
is stored, manipulated, and communicated
using a “system” consisting of multiple
pieces of hardware and software and
because specialized training is required to
use specific systems.” (Shapiro and Varian
1999)
Hess and Ricart describe switching costs as
“costs that deter customers from switching to
a competitor’s product of service” (Hess and
Ricart 2002). They also point out that
switching costs do not only include financial
expenses but also the time, effort and
knowledge that were invested in the product
or service. Shapiro and Varian expanded this
definition and include the costs that occur on
the supplier side to the total switching costs
(Shapiro and Varian 1999).
On the other side of the medal, having low
switching costs is quite threatening for Google
since the vast majority of its revenues derive
from advertisement on the search page. Their
additional services, like Gmail, Google Maps,
Google Buzz, help to connect users with their
website, but are not directly linked with the
search engine (Richard 2010).
Switching costs and customer loyalty
In general, a lock-in or high switching costs
can be as beneficial as jeopardizing to
business, depending on which side of the deal
one is. Having customers locked-in to your
system, is favorable for any company.
A research on the correlation between
customer loyalty and switching costs has
shown loyalty increases with the switching
costs (Ruyter, Wetzels et al. 1997; Lee, Lee et
al. 2001).

Switching costs and lock-in’s are closely

associated: the higher the switching costs, the
wider the lock-in (Hess and Ricart 2002).

Switching costs and search engines

In the case of web search engines, the basic
switching costs are very low; no hardware,
software or special knowledge has to be
changed when using a different search
service. A simple modifications in browser
settings or saving a new bookmark changes
the search engine. Users are not locked-in
Google’s search engine and can easily switch Customer loyalty is usually associated with
to another website. high satisfaction, emotional attachment or
peer recommendations; consumers have
brand/product preferences, engage in repeat
purchases and long-term commitments to the
brand or product. With reference to high
switching costs, consumers seem to show a
high level of loyalty to brands, since high
costs make them not likely to switch between
different brands (Lee, Lee et al. 2001).
However, this “false” loyalty does not reflect
on the customer’s satisfaction with the
product.
2.Expectations Management
Expectation management is a formal process
to continuously capture, document, and
maintain the content, dependencies, and
sureness of the expectations for persons
participating in an interaction, and to apply the
information to make the interaction
successful. To a large extent, people declare
that a project has either succeeded or failed
based on whether it met their expectations.
Few projects fail in an absolute sense that is
they simply fail to meet individual
expectations.
It is a strategy which has been used in the
business world for many years as
o rg a n i z a t i o n s a t t e m p t t o m e e t t h e i r
customers’ needs
Jeff Gainer discusses the importance of
managing a customer's expectations saying
that: Expectations management is the key to
successful project outcome. Rather than
fumbling along and discovering expectations
along the way, it is more prudent to determine
measurable quality expectations at the
beginning of the project and monitor and
re p o r t p ro g re s s a g a i n s t t h e s e g o a l s
throughout. Expectations management is very
similar to requirements management--but the
crucial difference is that we are managing the
client, not the product.
Switching Expectation management and
search engines
Yahoo and Excite were the 2 most important
search engines, they began the new era of
search but even though they were both
popular the need for a deeper search was
never met and thus the growing expectations
of the people was never met.
In 1998 along came a company called Google
which was founded by Larry Page and Sergey
Brin. They believed that keeping your
costumers happy would mean keeping them
for good! They believed that by making things
more viable and easy to use can result in
getting GOOGLE to become the world
dominator. Now in simple terms Larry page
and Sergey Brin just met the expectations of
the fast growing and eager new generation.
They thought it is wise to do away with flashy
advertisements that plagued the home pages
of their closest rivals Excite and Yahoo, and
they were right.
The Idea that placed them far above the rest
is Link reading or laying out links according to
the hierarchy of the number of times a site
had been visited, this made more useful sites
appear 1st which again made things so much
more easier for us today, again an example of
not only meeting their user’s expectations but
surpassing all expectations. Google is a
classic example of a company who knew
there was no room to be slack and knew that
as long as they innovated and as long as they
met the expectations of their users they would
remain a world dominator, something
companies like yahoo and excite failed to
understand at that time. Their commitment to
innovation and high regard for user’s interests
has only helped them get to where they are
today and indirectly making the world a
smaller place. As long as Google continues to
fulfill our expectations and innovate we have
faith the user’s not going to go anywhere.
3.Alliances
According to the authors of Information Rules,
an alliance is when each member “contributes
something toward the standard, and in
exchange, each is allowed to make products
complying with the standard” (Shapiro and
Varian 1999). So in simple jargon, an alliance
is when a group of companies (or individuals)
get together and try to put a product on the
market that will hopefully benefit all investors.
An alliance or rather, the negotiators of an
alliance base their investment on the following
three strengths; control of the existing
product, its superiority in relation to other
products on the market and finally intellectual
property rights (Shapiro and Varian 1999).
Alliances in search engines
S u c h a l l i a n c e s a re v e r y c o m m o n i n
information technology and are not only
limited to search engines. An example of an
alliance, which left an impact on the
technological world, is that between Compaq,
Intel and Microsoft, whereby they came
together, creating DSL. When it comes to
search engines, an alliance that could have
happened early on was between Microsoft
and Yahoo! Both companies were reluctant at
first, however when they saw what Google
had to offer, they had no other option but to
budge, otherwise they would risk being left
behind. Excite, the early rival of Yahoo! tried to
buy Google when the search engine was still a
comparatively small company but the deal
was never closed. However, Google and Idea
Lab did forge an alliance, whereby the latter
helped the former to figure out how to
advertise on the search engine, while
simultaneously not falling into the
“monotonous” advertising traps (like those of
Yahoo!). Also with the help of Overture,
Google was able to set up Google Adwords
(which was oddly similar to Overture), however
it can be said that this was not so much an
alliance but rather “borrowing” of ideas.
Bibliography
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November 2010, from http://www.domaintools.com/internet-statistics/.
!
Hess, M. and J. E. Ricart (2002). Managing Customer Switching Costs; A framework for
competing in the networked environment, University of Navarra.
!
Lee, J., J. Lee, et al. (2001). "The impact of switching costs on the customer satisfaction-
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35-48.
!
Meghabghab, G. and A. Kandel (2008). Search engines, link analysis, and user's Web
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Richard, M. G. (2010). Why Google is Not Like Microsoft and Facebook. Michael Graham
Richard.
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Ruyter, K. d., M. Wetzels, et al. (1997). "On the relationship between perceived service
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Shapiro, C. and H. R. Varian (1999). Information Rules: a strategic guide to the network
economy, Harvard Business School Press.
!
Jeff Garner, Concepts of Expectations Management

Derrick E. Rancourt. Expectations Management