Twenty-three years ago, Sergey Brin and Lawrence Page presented the idea of Google in their research paper, ‘The Anatomy of a Large-Scale Hypertextual Web Search Engine’, optimistically concluding that “there is a bright future for search”. They couldn’t have been more prophetic. Google has, over the years, built its massive empire, thanks to the continuing success of its search engine.
It has been so successful that its brand name is synonymous with the word “search”, worryingly so for the company. Its rivals have been few and far. And don’t forget the commercial success — last year, Google made revenues of over $100 billion just from its search operation. It is in this Google-dominated universe that newcomer Neeva sees an opportunity. Just a few days ago, Neeva made its search engine available for users in the United States, promising them “a private, ad-free search experience with only real results”. Users who sign up get three months of free access, after which they have to pay $4.95 every month.
There has also been a buzz around Neeva for it being the story of two ex-Googlers, Sridhar Ramaswamy and Vivek Raghunathan, challenging Google in its core business. Mr. Ramaswamy, a former senior vice-president of ads at Google, was part of the team that built Google Search in the early years. Mr. Raghunathan is a former vice-president of monetisation at YouTube. They are both IIT alumni.
So, what opportunity did they sense in a marketplace where Google is near-ubiquitous? Mr. Ramaswamy made this clear in his very first blog for Neeva about a year ago. He wrote: “As the leader of Google’s advertising products until 2018, I truly believed in the benefits of an ad-supported search experience... However, I have come to believe that ads detract from a good search experience and have also had many unintended side-effects that have large social consequences.” The post was titled, “A new way to search that works just for you.”
Neeva’s goal to fix the search experience is, therefore, tied closely to its ability to build a non-advertising-based business model. This explains its subscription model, a rarity is the business of search engines.
Not the free model
Around the time Google first came into the picture, the question of how best to navigate this mammoth, ever-growing resource called the Internet was yet to be resolved. It was still the early years of the Internet, and not surprisingly a number of players opted for a course that best mimicked offline offerings, something they were familiar with. Those like Yahoo, therefore, chose to build themselves up as portals, where information was organised so as to help users surf the Web. And there were others such as Inktomi and Alta Vista, who focussed on helping users search the Web.
Google “entered with a new approach to searching — namely, by ranking web pages on the basis of the number of links to those pages and, eventually, by supporting itself with advertising,” says author Shane Greenstein in the book, How the Internet Became Commercial. Like many other internet services, search has almost always been free for users. In 2008, it was in explaining this business strategy that Chris Anderson wrote the book Free: The Future of a Radical Price.
Neeva isn’t going that way. It has come into being at a time when subscription models are much more in vogue in the broad digital world. In an interview to business magazine Fast Company, Mr. Ramaswamy says, “I tell people that Neeva is as much a social experiment as it is a technological experiment.” He adds, “If there was a high-quality product that clearly benefits you in multiple ways, would you pay for it as opposed to having it be free, supported by ads?”
Last year, in one of his blog posts, he weighed in on the question of price. He wrote: “We will start at a reasonable price, say the cost of two black coffees a month. We hope that over time, we will be able to reduce the price as we become more efficient. Everything that we take for granted (our computers and phones, even ice cream) started out at a higher price point before scale and innovation made them available to everyone.”
New challengers
Neeva isn’t alone in seeing an opportunity in search. Just a few days before Neeva’s announcement, Brave Browser announced the beta version of its Search tool — “offering users the first independent privacy search/browser alternative to big tech”. In recent years, DuckDuckGo has been an alternative that has emphasised privacy over other things.
Last month, it said, “Spurred by the increase in DuckDuckGo app usage, over the last 12 months, our monthly search traffic increased 55% and we grew to become the #2 search engine on mobile in many countries, including in the U.S., Canada, Australia, and the Netherlands”. It further said: “We don’t track our users so we can’t say for sure how many we have, but based on market share estimates, download numbers, and national surveys, we believe there are between 70-100 million DuckDuckGo users.” Tech Crunch reported DuckDuckGo picking up another $100 million in investment, saying, “Privacy tech continues cooking on gas.”
In March this year, Neeva raised a further $40 million in funding from Sequoia Capital, Greylock Partners and Inovia Capital. They had raised a similar amount in an earlier round.
This is a very different world compared to the initial years of Google, when it was important to not only improve the search results but also build new features. Those years saw new features such as news, shopping, videos, and maps coming in. Privacy has emerged as an important competitive element across many digital product categories.
The world has changed in another way. As David Doty wrote in a Forbes article, “People aren’t just typing in a search term on whichever main search engine they prefer — they’re searching and consuming in context, on YouTube, Netflix, Amazon or Pinterest and increasingly on any of a zillion specialised apps.” The point being, the search market is more fragmented than ever.
And yet, as a study last year by the Competition and Markets Authority of the U.K. pointed out, “There is a long history of search providers other than Google and Bing choosing to outsource some or all of their search engine activities.” The reference is to them maintaining web indexes. It said, “The main way that they acquire information for their index is through their automated web-crawling bots. These bots follow the links between webpages and bring data about those pages back to the search engine’s servers.”
The Fast Company story says Neeva “has indexed several billion web pages on its own but also credits Apple, Bing, and Yelp at the bottom of search results; other information providers include Intrinio, Weather.com, and Xignite. Even Google is an ingredient, with Google Maps embedded in search results”.
The important question now is: will users pay for search?
