"If Google wins this, Microsoft is shut out of the mobile search game in this country," he says. "Microsoft can't let them win this."
Still in its infancy, the mobile Web has the potential to generate big bucks. According to comScore, more than 17 million wireless subscribers performed a Web search on their mobile device in September, or about 7.7% of total users. Of the 17 million, 60.1% used Google for their search needs, compared with 36.4% for Yahoo! and 10.3% for Microsoft.
Research from eMarketer shows that in 2007, an estimated $35 million was spent on mobile search advertising in the U.S. That number is expected to climb to $107 million this year and $242 million next year.
For total mobile advertising -- which includes search, display, and messaging ads - spending in 2007 was $878 million. eMarketer predicts it will grow to $1.66 billion this year and $2.81 billion next year.Rajeev Chand, a wireless analyst with Rutberg & Co., says that while being the default search engine on any mobile device has its advantages, that may become less important over time. "Today, users will use the default search provider because mobile is still new and the interface is tough," he says. As the industry matures, however, users will learn to bookmark their preferences and bypass search altogether, Chand says. Entner agrees that in the long run, default search providers might not make much of a difference. "But in the long run we're all dead," he says. "This is about the short run. If you can kill the competition in the short run, there's no one around in the long run to take your cookies away."