It occurred to me that the two ideas I discussed in the previous post (How Google Came Into Being) are not just founding ideas of Google, they are the two fundamental pillars on which the company's business stands today. Shake either of these and you shake the foundation of Google. Hypothetically, if a start-up (or an established company) wanted to beat Google, it could do it by excelling at either of these areas:
- A vastly superior search technology that pulls away Google's users
- A vastly superior advertising model that pulls away Google's advertisers.
Most mainstream media articles while assessing Google's threat focus on the former and completely ignore the latter. Invention of a vastly superior search technology by a competitor that takes away Google's users is a near impossibility as I explained in the past in Google and the Great Mousetrap Fallacy.
It's much more likely, relatively speaking, that someone comes up with a superior advertising model. If an innovative, more efficient online advertising model develops that promises the advertisers vastly superior returns, they will not hesitate to leave Google. Whether the new ad serving model might create a whole new market by itself in addition to the search industry or it will take away advertisers from Google or a bit of both depends upon how efficient it is and what segment of audience it targets. But relatively, this is a more plausible scenario for a Google Killer and one that most people miss completely. 
When Microsoft launched their MSN search beta last year and then formally released it in Feb, the newspapers and blogospehre was full of speculation of how Google has more competition now and how MSN will lure users away from it. Hundreds of articles appeared everywhere. Five months later when the results of market share of the search engines was announced, MSN was the only major search engine that actually lost its market share since January. 
Now when we hear about AlmondNet, a start-up with a brand new ad serving model that could well pose a real threat to Google, there's almost no news coverage at all. AlmondNet is a "post-search" behavioral ad network that can revolutionalise online advertising if it can overcome the obvious privacy concerns of its users. AlmondNet's patented model solves the problem of two gross inefficiencies in the two main forms of online advertising prevalent today:
- Search advertising is visible to people only during the 5% of their browsing time. People spend 95% of their time online on other kinds of activities - content, communications and commerce.
- In impression based advertising, 70-80% of ad space inventory on the internet is sold as low as $0.20 CPM. So, when a person on a high profile $100 CPM site moves to an unknown site, he is suddenly valued at hundreds of times less than he was moments ago.
To learn how exactly AlmondNet exploits these inefficiencies, read the excellent overview of AlmondNet by Danny Sullivan written back in January, when the service released and this recent Wired article. And here's John Battelle's initial take on it (notice the comments section, where none other than Mr. Nielsen chimed in to say he predicted it).
Notes and Links
 That theoretical scenario laid out, I don't think Google will sit on their collective butts and let a startup take a bite at its core business. Google has a great infrastucture in place to launch such a network of its own. However, in AlmondNet's case its patent might come as a roadblock for Google.
 According to search engine ratings for the first five months of this year, Google gained its market share by 0.9% points and MSN lost it by 0.4% points after registering a brief but noticeable spike for the two months succeeding the launch.