While nearly half of all Web search engine users prefer industry leader Google Inc. over its rivals, the soon-to-be public company faces challenges as it expands into new businesses, Standard & Poor's Equity Research Services said on Monday.
Forty-eight percent of search engine users say they use Google most overall, compared with 20 percent for Yahoo Inc., 14 percent for Microsoft Corp.'s MSN and 7 percent for AOL, according to a nationwide survey commissioned by Standard & Poor's and conducted by online market research firm InsightExpress. (MSNBC content is distributed by MSN. MSNBC itself is a Microsoft - NBC joint venture.)
The survey showed that users favor Google for the relevance and accuracy of its results. Nevertheless, more than 6 of 10 Google users said they would switch search engines if a better service was introduced.
On other fronts, fewer than one-quarter of search engine users would be very likely, 8 percent, or somewhat likely, 15 percent, to sign up for and regularly use a new personal e-mail service if it offered -- as is promised by Google's test e-mail service Gmail -- unlimited storage, e-mail search and targeted advertising.
Google, which is marching toward its much-anticipated initial public offering, also is testing a new comparison shopping service called Froogle and is affiliated with an upstart social networking service called Orkut.
"We believe Google and its shares will also face risks relating to commoditization of the company's offerings, difficulties related to its introduction of new products and services, and competition from the likes of Yahoo and Microsoft," said Scott Kessler, S&P's Internet software and services equity analyst.
S&P's preliminary estimate for Google's market value is $33 billion to $40 billion.