Anecdotally, I still often hear people say (like I did last night) that it wouldn’t take that much for a new company to enter the search engine market. But we are not in the late 1990s and it would take tremendous resources to enter this market.
The major players at this point are AOL, Ask Jeeves, Google, Microsoft and Yahoo!. (Note that in contrast to much anecdotal evidence in the press and among other commentators, Google does not have nearly the market share that many people suggest. Here’s one occasion when I already commented on this point.)
Among the above search engines, AOL, Google, MSN, and Yahoo! represent much more than just search engines. They are vast empires of Internet-related products that continue to innovate and introduce new services.
This does not mean that there is no room for innovation. In fact, we seem to be undergoing a second boom these days (somewhat reminiscent of the late 90s, but in a much more realistic manner). Numerous interesting and innovative services have sprung up in the last few years. However, you will notice that many of these are eventually acquired by one of the companies above. Examples: Google’s acquisition of Blogger and Yahoo!’s acquisition of Flickr.
And to be sure, we have even seen new entrants in niche markets of search, for example, the searching of recently added content. Here, Technorati and Feedster come to mind. While offering valuable services – an almost immediate inclusion of blog content in search results – these engines focus on a very small segment of Web content.
It would take tremendous amount of resources in this day and age to even come close to the computation and labor resources that drive the above-mentioned companies and allow them to index Web content at a more general level. It is unlikely that we will see independent new entrants in the near future. If we do, they will likely be acquired by one of the companies above.