Google’s move to demote the Chrome website in search rankings in January led to a decline in browser market share, according to new data from Net Applications. Google’s Chrome web browser dropped from 19.11% in December to 18.94% in January, the firm found. Meanwhile, among the other browsers, only Internet Explorer saw significant gains during the month, going from 51.87% in December to 52.96% in January.

The reason behind Chrome’s drop – the first in two years – is likely the advertising scandal Google found itself last month. Google had hired a third-party ad agency Unruly Media to drive views of a new Chrome video by paying bloggers to post it on their own websites. One blogger linked back to the Chrome download page, without using a “nofollow” attribute which would have prevented the page from getting an extra boost. The move was in clear violation of Google’s own paid link policy put in place to combat spam. Penalties for actions like this range from a month to a year of penalized search rank.

Google ended up doing the right thing and demoting the Chrome download page (www.google.com/chrome) for at least 60 days by setting its rank to zero. Previously, Chrome ranked #2 in a search for “browser,” but after the demotion, it was #50. Today, the Chrome website is showing up on page 6 of Google Search – in other words, practically invisible.

Chrome’s loss, for now at least, is IE’s gain. In fact, TechCrunch itself saw similar trends in January, much to our surprise (shock/horror). IE was ahead of both Firefox and Chrome for referral traffic mid-month. Our data showed that it was (TC parent company) AOL traffic that was so IE-friendly.

But that seems to be a coincidence. According to Net Applications, Windows XP’s market share grew in January, going from 0.67 points to 47.19 points, something that could have contributed to IE’s bump. To be clear, Windows XP didn’t necessarily see more users, it saw more usage. Maybe the typical year-end wrap-up work at businesses led to increased XP usage, as IE6 still powers some business applications? Or maybe browser market share numbers pulled from sources like Net Applications should be taken with the proverbial grain of salt.

For what it’s worth, other browsers saw dips, too, including Firefox, which went from 21.83% to 20.88%, and Safari, which dropped from 4.97% to 4.90%. Opera, saw a tiny gain from 1.66% to 1.67%. More data is available here on the Net Applications website.