I agree with Dave on this. And Robert. And Fred. And (partially) Richard. Companies, even big companies, especially big companies, need to open up their data without usage limits, or else they will make their services and themselves irrelevant.
At TechCrunch I give preference to companies that have distributed, as opposed to centralized, data. I really like companies that take other people’s/service’s data and do something more useful with it. And I give bonus points to companies that open up their data via APIs for the world to mash. Those companies are more likely to be written about, and more likely to have positive reviews. Now if a company has an API, but limits its usage, it’s pretty unlikely that anyone building a scalable service will rely on it. They’ll go elsewhere.
So, yeah, companies need to think about this, hard, when they are building their services. I understand the fear of losing your audience, but the only way to become and stay relevant is to give as much, or more, as you take from the web.
The question comes in as one of business philosophy. The issue is one of revenue stream. Personally, I work for a newspaper that is struggling to define how it is going to utilize the web. It is unquestionably a route they want/need to go down… which is why they hired me. However, they have yet to decide WHAT they are going to do. If they give away their content for free… they fear that they will be endangering their print subscriptions.
While I understand your focus in this post is about the general concept of APIs as they relate to search, it is a debate that is pertinent to any sort of “something I have, something you want” arguement. If you give the “something I have” to everybody… unrestricted… where does that leave you with respect to revenue? Returning to your topic…
If Google allows everybody to use unlimited queries… why visit google.com to search when you can provide your own search, sans google ads, on your own site.
The answer? Require adsense to be used wherever a Google search is rendered on an unlimited license.