In Depth October 1, 2009, 5:00PM EST

Can Google Stay on Top of the Web?

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Google's top troubleshooters (l-r): anti-spammer Cutts; Singhal, head of rankings; and Huffman, who runs the "eval" unit Illustration by Alex Robbins

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Cutts' unusually public role was on display at the recent Search Engine Strategies conference in San Jose. In this crowd, Cutts is a rock star, his blog posts studied as carefully as Wall Street traders deconstruct comments by Federal Reserve Chairman Ben Bernanke. Cutts served on a panel called "Extreme Makeover: Live Site Clinic," where three dozen Webmasters rushed up to provide business cards. The first site was a sex toys emporium called mypleasure.com. An unruffled Cutts suggested changing its URLs, or Web addresses, to contain more product-related words. Examining a Midwestern department store site, Cutts chided, "Your URL structure is pretty much a search engine obstacle course," advising the Webmaster to excise question marks and other symbols.

The reason Google has become such a powerhouse isn't just because its search technology is exceptional, of course. It's because the company perfected a way to match advertisements to its search results. Hundreds of thousands of advertisers in its AdWords program bid in an online auction to buy "keywords," or terms likely to be in search queries, that they hope will trigger their ads to run on the right side or the top of the search results page. It's a good bet that people searching on, say, "sony cybershot" are in the market to buy a digital camera, and retailers that buy that term are more likely to attract clicks and sales. Spending on search advertising has soared in recent years because advertisers tend to get strong returns for their money.

How well are all the search improvements underlying those lucrative ads working? While no one knows for sure whose search results are best, a number of independent experts continue to give Google the nod over its rivals. And they think the current crop of would-be disrupters isn't going to beat Google at its own game anytime soon. "None of these are big challenges for Google," says search expert Sullivan. "I think Google is still better in quality."

For now, at least. But Google engineers know they need to think outside the search box to stay ahead. A recent contest called CSI, for "Crazy Search Ideas," asked engineers to submit improvements they thought would never be approved because they were weird or seemed too minor. Some 118 entries were culled to four, which are still being explored. Describing such left-field efforts after the recent Tuesday morning meeting, Manber mused about how easy it is to climb a hill and think you're on top of the world. "My worry is we could be stuck on top of a hill," he says, "and it's not the right hill."

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Inside Google's Ad Machine

If few people understand how Google's search engine works, fewer still understand the search advertising system that funneled close to $22 billion into the company's coffers last year. An article in Wired magazine's June 2009 issue uncovers the inner workings, explaining how Google runs an auction for some 2.5 billion daily searches. One key fact: The highest bidders don't always win.

Go to http://bx.businessweek.com/google/reference/

Hof is BusinessWeek's Silicon Valley bureau chief.