...is even a FAQ page that will answer most of them.  Here is how Google Suggest is described:

What is Google Suggest?
As you type into the search box, Google Suggest guesses what youre typing and offers suggestions in real time. This is similar to Googles "Did you mean?" feature that offers alternative spellings for your query after you search, except that it works in real time. For example, if you type "bass," Google Suggest might offer a list of refinements that include "bass fishing" or "bass guitar." Similarly, if you type in only part of a word, like "prog," Google Suggest might offer you refinements like "programming," "programming languages," "progesterone," or "progressive." You can choose one by scrolling up or down the list with the arrow keys or mouse.

One interesting feature of Google Suggest is that items appear with a green number next to them representing the approximate number of results that would return for the suggested query.  So if you like what the rest of the crowd was looking for when they typed your phrase, then you can select one of these popular choices.

The selection shown is clearly determined by some algorithm.  Sometimes the choices shown are not at all obvious.  For example in searching for my user name, bwelford, after typing bwel I got the following results:

In this case, the algorithm seems to be assuming that this is a typo.  The choices offered are reasonable, but the order they are presented seems to have no logic.  It is not in order of the number of searches done with that expression.  Does the algorithm throw in a random ordering to spread keyword choices among the possible contenders?  That is a mystery for the moment.

As with any change, there are winners and losers.  One clear winner would seem to be the searcher.  If and only if they choose to do so, they can more quickly get to the item they had in mind provided it is on the list. 

An even bigger winner is probably Google itself.  This mechanism is likely to funnel visitors towards a more restricted set of choices of keyword search pages.  Given that such search pages have Adword ads on them, this funneling could well mean that AdWords advertisers are automatically competing on more restricted options.  This could therefore mean higher Pay Per Click revenues to Google.  If this theory is correct, this could have a significant improvement for Googles bottom line.

and who are the losers?  If Google is making more money on AdWords, then this means that AdWords advertisers are losers here.  They must pay out more for each click on these more visited web pages, given that they are now competing with more AdWords advertisers wishing to appear for these more attractive keyword phrases.

The other losers may well be owners of web pages that have always ranked well for long tail searches. As others have suggested, Google Suggest may well influence the traffic coming to any given web page.  This funneling of searchers choices might sound like a small change but it can have a big effect on traffic.  If most of that traffic was coming through a long-tail search, where someone typed in a fairly long phrase, they may now cease to do that.  Such a searcher may choose the closest concept among the items presented.  Unless the searcher is persistent and insists on typing out their long-tail search query, they will now never come to that particular web page.

Since the winners for this move vastly outnumber the losers, and Google is among the winners, it seems unlikely that this added feature will disappear. We must all learn to live with it.  Search Engine Optimization was already proving to be a challenge with other Google changes and Google Suggest now raises the stakes considerably.

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