It's Google's game to loose, not Macrohoo's to win
In my opinion, the only way that any competitor to Google is going to make serious headway (rather than simply p*ss against the wind) is if Google shoot themselves in the foot.
Google came to the fore because of their simple interface, the search box and the "Google Search" button.
Users loved the simplicity. Want to search? That's all there is - great user interface.
All of the other search engines, Yahoo, MSN, Excite, Alta-Vista, Lycos etc all tried to offer more. They went down the "web portal" route trying to be all things to all people but sadly became Jacks of all Trades and Master of none. They became so complex that finding the search box became a task in its own right.
This loss of focus on their key reason d'etre simply ensured that once people were made aware of Google and gave it a try - they tended to switch their search providers and provided Google continue to serve up the goods then they won't move away unless someone can do it significantly better. (and the goods can be [and are] different to results on other search engines - not necessarily better or worse, just different]
The problem is that although "Bing" plays homage to Google with a simple search interface, Bing has yet to work out what it is, as evidenced by a simple search conducted as an experiment and highlighted in this blog http://bit.ly/flJnf
Google continue to improve their systems, they just tend not to make such a big fuss about it (maybe they should) and rather than invest $100m in marketing, as apparently MS are doing for "Bing" would probably be much happier investing it in Eco projects (www.google.org) and on their search results