June 5 (Bloomberg) -- Google Inc.’s leadership in mobile search is under pressure as cell phone and tablet users look for information from applications rather than from their browser query bar.
By 2016, Google’s share of the U.S. market should fall to 64 percent in 2016 from 83 percent in 2012, according a new report by EMarketer Inc. Meanwhile, Yelp Inc., whose popular application helps users find ratings and information on local restaurants and dry cleaners, will grow to 1.9 percent from 0.5 percent.
Google became the most valuable Internet company in the world based on its desktop-based query engine. While its revenue tied to smartphones and tablets is growing, the Mountain View, California-based company is grappling with rising competition to its search product on mobile devices. Spending on mobile search is set to make up 86 percent of the U.S. digital search market by 2018, up from 13 percent in 2012, according to EMarketer.
“Even though browser-based search is a common behavior among mobile owners, search engines are not necessarily the first place smartphone and tablet users turn,” Cathy Boyle, an an analyst at EMarketer, said in the report. “The explosion of mobile app development and usage means mobile users have more -- and more specialized -- alternatives for finding information.”
Other search products are growing as well. A category including direct Google rivals such as Microsoft Corp.’s Bing, as well as applications tailored to more specific industries, such as e-commerce giant Amazon.com Inc., travel-focused Kayak and job-hunting service Indeed Inc., will have 30 percent of the market by 2016, up from 5.4 percent, according to the report.
While Google has its own phone- and tablet-based search application, it gets much of its traffic through small query boxes that appear at the top of browsers as users surf the Web. The company has the default search engine on Apple Inc.’s iPhone and on many devices made by partners, including Samsung Electronics Co., that use Google’s Android operating system.
Google is providing a new feature on its search ads that brings consumers directly to an application from a mobile query- results page -- instead of staying within a Web browser. So, a user looking for a hotel in San Francisco, for example, could go immediately to the specific page inside the installed HotelTonight Inc. application.