Why are search engines free?

Search engines are online sites/services/toolbars that search the internet, according to user requirements, for the most appropriate results. Due to their usefulness, sophistication and popularity, the question of why the vast majority of them are free is often asked.

Different search engines

The undoubted market leader of search engines is Google. It performs hundreds of millions of searches every day. The search engine has been so successful that ‘to google’ has entered common parlance as well as the Oxford English Dictionary as from summer 2006. The company has built on the huge success of its search engine by branching out into various other areas of the internet such as videos, images, books, translation, finance, maps and street views and even internet browsing (being the second or third most popular). Other popular search engines include Hotmail’s Bing, Ask Jeeves and Yahoo. Many individual sites also have their own search engine.

Hits

Putting aside many other benefits, website hits alone can earn a website a lot of money. Internet traffic to the site can get the owner a lot of money. The number of visitors necessary to make any real profit are so high that it is not advisable to budding internet entrepreneurs to target this as a primary source of income. However, internet behemoths can command some money from internet service providers such as Virgin and TalkTalk. This is because a significant amount of a prospective buyer’s interest in these companies is due to these huge sites.

Advertising

Perhaps, the biggest way search engines make profits (Google made over $8.5 billion in 2010) is through their search engine promotion and advertising. They place advertisements in strategic places. For example, Google places them to the right of the search results page. There are often some sponsored results for certain searches which get prime billing at the top of that particular web page search. Companies pay top dollar for these website promotions. They are safe in the knowledge that many people will see their companies, due to the huge traffic that the top search engines receive.

Targeted advertising

Google in particular is getting particular savvy at this because they covertly have a huge database of information on people who sign up to certain agreements and who are perhaps unsure of the scope of Google’s knowledge. Google uses this information to target advertising appropriately and has even been alleged to have passed it on to third parties for a profit. Indeed, Google tailors your search results to ‘your interest’ in terms of location, but allows more scarily supposed preferences to an extent.