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Microsoft's dilemma: 9 in 10 Brits now use Google

Microsoft continues to fight a losing battle in its attempt to reel in Google, the runaway leader in internet search.

In May, Google performed 87 per cent of all internet searches conducted in the UK, according to Hitwise, the research company, and 68 per cent of searches globally.

That's an increase of 9 percentage points on the same month last year in the UK, and means that Google is now in a more commanding position than ever to capitalise on the fast-growing internet advertising market, which is predicted to grow to $80 billion by 2010.

Over the same period, Microsoft's share of UK searches declined from 5 per cent to 4 per cent, and Yahoo!'s from 9 per cent to 4 per cent.

So far the Office of Fair Trading has not considered the implications of Google's impressive lead, which at the current rate would stretch to give it a greater than 90 per cent share of all UK searches at some point near the end of the year.

It will not do so until someone complains, it told Times Online today - but declined to say whether it had received any such complaints.

"Generally we respond to complaints," an OFT spokesman said. "If anyone thinks that there's either abuse of a dominant position or a lack of competition (in a given market), then we consider each case on its merits."

By law, the OFT is not able to disclose whether it has received any complaints about Google, the spokesman said.

A competition lawyer at a major City firm said that he had heard of complaints having been made about Google from within the internet industry, but that so far the OFT was not proposing to take any action.

"There's no sin about being dominant - the only sin is when you start to abuse that dominance," the lawyer said.

He said there were a range of factors the OFT would consider in any case about Google, including whether it discriminated between advertisers - or agreed to deal with some and not others, whether it charged execessively, or whether engaged in 'predation', where prices are dropped significantly in an attempt to squeeze out competition before being raised again.

Google has already been subject to scrutiny by European authorities, but has so far emerged unscathed. The European Commission said in July last year that it would review Google's $3.1 billion acquisition, one of the largest brokers of online ads, but it approved the deal in March.

Broadband: why the countryside can't catch up

Few people will be shocked to hear that British broadband is faster in cities than in rural areas. What is more surprising is that the gap is likely to broaden before it narrows.

Our attempts to conjure up a 21st-centrury network from a 19th-century infrastructure have created a multispeed internet in which those living furthest from a telephone exchange have to put up with miserably slow download speeds. BT is doing its best to coax data through copper wires at ever-faster speeds, but its efforts are likely to upgrade the fastest connections while doing nothing to help those stuck with the slowest.

A new technology – new to Britain, at least – will boost web performance by a factor of three, but only for about a million homes in the London area. Even when coverage is extended to ten million homes next year, most of those will be in areas where high-speed cable connections are already available.

Without a huge investment in building a national fibre-optic network, there’s little that BT or any other company can do to improve the broadband experience for people living a long way from telephone exchanges.

Satellite uplinks offer fast, dedicated internet connections, but the cost is prohibitive, and wireless options such as WiMAX and mesh networks have yet to make much of an impact. They are, however, increasing in reach and speed, and that’s a huge disincentive for the people who would have to pay for a national fibre-optic infrastructure: no one wants to make a multibillion pound investment in a network that will soon fall quiet as web traffic takes to the airwaves.

The result is that the slower pace of rural life is like to be complemented by slower internet connections – and the resultant frustrations for social and business web users – for some time to come.

Britain's online video habit: three web clips per day

Here's a finding that, while inevitable, is sure to raise the blood pressure of your typical ISP executive -- and your boss. Our daily online video habit is reaching a staggering proportion.

According to Comscore, Americans viewed 11.5 billion (yes, billion...with a b) videos in March, or an average of 83 videos for every American who ventured online last month. The most recent tally for the UK is even greater, Comscore says. In December, Britons watched 3.1 billion videos, or 108 videos per UK net user.

Assuming an average video length of two minutes, you are talking about more than 103 million hours spent (some may say "wasted") in front of the computer watching YouTube and, for a week at least, the BBC iPlayer (the iPlayer launched on Christmas Day klast year).

It would be interesting to see Comscore's most recent numbers, which will reveal the iPlayer's contribution to our video-snacking habit. It will also no doubt trigger more howls of protest from the likes of Tiscali and Sky, who see the iPlayer as the biggest threat to their business.

In the US, YouTube is the dominant player, Comscore reports. The video-sharing behemoth has 38 per cent of the market (by videos viewed; 51 per cent if you count unique viewers) and its audience is growing.