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Facebook Unveils Social-Search Tool Challenging Google

January 16, 2013

Facebook Unveils Social-Search Tool Posing Challenge to Google

Graph Search lets users discover people, photos, places and interests, Chief Executive Officer Mark Zuckerberg said yesterday at Facebook’s Menlo Park, California, headquarters. Photograph by Stephen Lam/Getty Images

Facebook Inc. (FB:US) unveiled a tool for searching information posted to its social network of more than 1 billion users, creating an alternative to services now available on Google Inc. (GOOG:US), LinkedIn Corp. (LNKD:US) and Yelp Inc. (YELP:US)

Graph Search lets users discover people, photos, places and interests, Chief Executive Officer Mark Zuckerberg said yesterday at Facebook’s Menlo Park, California, headquarters. The company showed how the service can be used by recruiters to find potential hires and by members seeking dating partners.

When fully rolled out, the tool will give many Web users an incentive to spend less time on Google, Yelp’s reviews and LinkedIn’s professional site. While Zuckerberg said the new feature could be a “business” in the future, he didn’t outline how it will make money soon. That failed to satisfy investors anticipating steps to generate income quickly, according to Susan Etlinger, an analyst at Altimeter Group LLC.

“There’s a lot of pressure for Facebook to increase its monetization efforts,” Etlinger said. “It still works like a private company, it moves slowly.”

Facebook fell less than 1 percent to $29.85 at the close in New York. Yelp, a restaurant and business-review website, declined 1.2 percent to $20.36, and LinkedIn rose less than 1 percent to $118.09.

“Graph Search is designed to take a precise query and return to you the answer, not links to other places,” Zuckerberg said.

$15 Billion Market

Facebook’s new service, which is being rolled out in test mode to a limited number of members, draws from a pool of information that includes 240 billion photographs and more than a trillion connections. It also encroaches on Google’s turf as a source of information and a destination where advertisers can reach users. Google, by comparison, has indexed more than 30 trillion web pages and handles 100 billion queries per month.

“Which is more valuable? Finding a sushi restaurant in New York City or finding one that my friends like?” said Michael Gartenberg, an analyst at Gartner Inc. “This continues to pit Facebook against Google.”

If Facebook introduces more robust advertising based on search results, it could grab 5 percent of the $15 billion U.S. search-advertising market within a year, according to Karsten Weide, an analyst at IDC.

Facebook also said it has a partnership with Microsoft Corp. (MSFT:US)’s Bing search engine, which will deliver additional results from the Web when Graph Search doesn’t deliver clear answers to queries.

Google ‘Love’

Facebook hasn’t worked out a similar deal with the world’s biggest Web-search provider. Zuckerberg said he would “love to work with Google,” but that he couldn’t come to an agreement with the company over gathering and using people’s data.

While Graph Search makes finding information on Facebook more efficient, results will be based on data already available to users based on their preferences. Privacy was built “deeply” into the service, Zuckerberg said.

Google has been moving onto Facebook’s turf with its own social-networking service, Google+, which was unveiled in 2011, according to Danny Sullivan, founder of the Search Engine Land technology blog.

“It will cause Google to do something about whether or not they need to look further at mimicking these kinds of searches that they currently cannot do,” Sullivan said. “They actually get back into Google’s face a little bit. Here, Facebook has sat and watched Google try to come into their space, no holds barred.”

Search Discovery

The two key Facebook employees behind the new service formerly worked at Google, including Lars Rasmussen, director of engineering, and Tom Stocky, director of product management.

The new search service should help keep users on the site more, Mark Mahaney, an analyst at RBC Capital Markets LLC, wrote in a research note.

“Improved site functionality should be a positive for users, driving more traffic, more searches and hence more ad dollars,” Mahaney wrote.

Graph Search is also aimed at promoting the discovery of new friends on the network, Zuckerberg said. Unlike Web search, which relies on keywords, Graph Search lets users combine phrases, such as “My friends in New York who like Jay-Z” to find out information that’s been shared on the social network.

Expanding Search

The search box, located on the top-left part of the home page, lets users enter a query and suggests potential searches as members type. The results can be tailored to specific parameters, such as time frame, location or other information that might be in profiles. For example, users on vacation in Ireland could look for pubs that others have “liked.”

Facebook plans to expand Graph Search to include information from user postings, as well as other online services connected to the social network. The feature will also be extended to mobile devices and other languages. For now, the search is available only in English to those signing up for beta testing.

The new service will include basic advertising tools that carry over from the previous, simplified search feature that lets companies and individuals highlight a result below the search box.

“This is just some really neat stuff, this is one of the coolest things we’ve done in a while,” Zuckerberg said. “Graph Search is a completely new way for people to get information on Facebook.”

To contact the reporter on this story: Brian Womack in Palo Alto News at bwomack1@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net


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