Barclays Capital’s Anthony DiClemente has an interesting theory about Siri and its effect on Google’s mobile search revenue. DiClemente points out that iOS grabs a whopping 60 percent of mobile traffic share according to Comscore’s December data. When you look at Google’s mobile search statistics, the bulk of the traffic is likely from customers using iOS devices to search using Google.
As Siri takes a bigger role in iOS, customers will increasingly use voice-assisted search instead of mobile search. Siri doesn’t use just Google for search; it can pull information from Bing, Wolfram Alpha and other mobile services. This shift from Google search to Siri search could have an impact on Google says DiClemente . Google estimates that mobile is about 20% of all paid search items and iOS is likely the biggest contributor. Any loss of customers to Siri could, in the long run, hurt Google claims DiClemente.
Though DiClemente’s premise is sound and Siri could redirect users away from Google search, the revenue loss for Google may be small compared to the search revenue it gets from the desktop. Macquarie analyst Ben Schachter said in a recent research note that Google generates $1.3 billion from mobile search, but only gets $335 million after it pays out traffic acquisition costs. The bulk of these traffic acquisition costs are actually being paid to Apple since iOS is the dominant mobile platform. In the end, Google may lose some traffic and revenue to Siri, but it might not be as harmful as DiClemente estimates.