Google announced Instant search today. Much like iTunes, Google will now automatically update results in real time as you search. For consumers, the difference is pretty much irrelevant. After all, Google can already find tens of thousands of results for pretty much anything in basically no time at all. See for example:
But the new service could be big for Google’s revenue. Google makes money by auctioning the right to run advertisements next to search terms. For example, Best Buy might want to its ad to appear next to the search results when someone searches for “stereos” or “video games”. The new service will likely steer users toward keywords where it can sell the most expensive ads.
The constant updating will discourage people from entering in long search strings or “tail keywords” that are difficult to sell ads against. Google makes more money if I search for “stereos” than if I search for “4-speaker surround sound swivel stereos tv compatible” because more companies bid on the simple keyword than the long string. In short, the new technology will let Google increase the percentage of searches that show advertisements and the rates that it receives for those advertisements. Instant search may not matter much to you, but it could be a big revenue boost for Google.
Right now you have to opt-in to use instant search, but it’ll be the default in the next few months.