iPhone pushes Google to early lead

By Michael Estrin

It's still early, but at first blush Google appears to own the wireless search market, according to data from Nielsen Mobile.

Google, which accounts for 61 percent of all mobile searches, bested Yahoo which came in second with 18 percent of the market. MSN accounted for 5 percent of the market.

But much of Google's success can actually be summed up in one word -- iPhone. Earlier this year, Google reported that the iPhone, which represents a mere 2 percent of the worldwide smartphone market, accounted for the bulk of mobile internet searches. But the good news for Google is that it's the default search engine on all iPhones, which is why marketers are closely watching the rollout of Apple's latest 3G iPhone.

So where does this leave the rest of the pack? Well, Yahoo has been working hard to cut deals with other handset makers and telecom carriers around the world. Most recently, the company announced six new telecom partnerships throughout Asia, bringing its total to 60 worldwide.

According to David Ko, managing director and VP of Yahoo's mobile division, the company can offer advertisers global scale to the tune of 600 million users. But while those numbers may sound good, Yahoo will have to offer more in terms of search functionality and ad serving if it's going to chip away at Google's lead. Otherwise, Yahoo may find itself cutting a mobile search deal with Google similar to the one the two companies are currently proposing.

As for Microsoft, it has the most ground to make up both in terms of raw numbers and user experience. While Microsoft is the default search engine on many mobile devices, it seems that fact did little to help it boost market share. According to technology blog Ars Technica, one potentially discouraging piece of information for Microsoft is that mobile users may have opted out of using it as the default search engine in favor of Yahoo, which is bundled in Opera Mini, a browser commonly downloaded by BlackBerry users.