Evan Schuman's StorefrontBacktalk

For those companies who may be plannng for Google to become less powerful over the next several years will get a rude awakening from a report published Wednesday from Cowen & Co., a major financial analysis firm.

The report sees Google today controlling 50-55 percent of search in the U.S. and about 70-75 percent in Europe. But when analyzing the competitive moves by rivals Microsoft and Yahoo, the report predicts Google’s marketshare will continue to soar, hitting “at least 90 percent of the search market over the next decade.”

The report gives quite a few reasons–most involving better R&D investments–but it stressed that a key issue is search quality, particularly in E-Commerce.

“We believe Google searches yield more relevant results and that its lead is
sustainable, especially for e-commerce queries,” the report said. “Although impossible to quantify, we believe Google’s search results are more likely to be relevant than Yahoo’s.”

“Google’s search traffic is three times greater than Yahoo’s and six times greater than Microsoft’s. The company is able to
use its greater sample size to fine tune its algorithms, which should allow Google to improve the experience on its search engine at a faster rate than its competitors,” the report said. “In addition, the recent launch of Google Web History, which tracks user search and website usage data, allows the company to augment relevancy.”