The Dynamics of Competition in the Internet Search Engine Market

UC Berkeley, Center for Competition Policy Working Paper No. CPC01-17

21 Pages Posted: 19 Feb 2004

See all articles by Neil Gandal

Neil Gandal

Berglas School of Economics, Tel Aviv University; Centre for Economic Policy Research (CEPR)

Date Written: January 2001

Abstract

Search engines hold the key to helping consumers access the wealth of information on the web. In this paper I examine the evolution of and competition in the internet search engine market. The goal of my analysis is to examine whether early entrants benefit in the long-run from their first-mover position in internet markets. I find that while early entrants (Yahoo, Lycos, Excite, Infoseek, and Altavista) still have an advantage, the pure brand effect advantage has been declining over time. Yahoo has maintained its leadership position by providing a superior product. The success of a wave of recent new entrants suggests that entry barriers are still quite low in the internet search engine market.

Keywords: Internet, Search Engines, Entry, Empirical Study

JEL Classification: D43, L86

Suggested Citation

Gandal, Neil, The Dynamics of Competition in the Internet Search Engine Market (January 2001). UC Berkeley, Center for Competition Policy Working Paper No. CPC01-17. Available at SSRN: https://ssrn.com/abstract=502823 or http://dx.doi.org/10.2139/ssrn.502823

Neil Gandal (Contact Author)

Berglas School of Economics, Tel Aviv University ( email )

Tel Aviv University
Tel Aviv 69978
Israel
+972 3 640 9907 (Phone)
+972 3 640 9908 (Fax)

HOME PAGE: http://www.neilgandal.com/

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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