That’s how much Microsoft lost in Q3 with its Online Services Division. (Read: Bing)
From the link:
During Microsoft’s fiscal third quarter, which ended March 31, the Online Services Division, or OSD, reported a 12 percent increase in revenue, which rose to US$566 million on the back of higher advertising revenue. That wasn’t enough to offset a surge in operating expenses during the period. The division’s quarterly loss grew by 73 percent to $713 million, compared to a loss of $411 million during the same period last year.
OSD includes Microsoft’s online advertising business, the Bing search engine, and its various MSN websites.
… but just barely. I’ve seen more than a few tech stories covering Bing’s modest gains in search engine market share. All well and good, but it’s worth looking at the actual numbers and some of the reasons for that gain. Let’s just say I think the Redmond bunch should probably keep the champagne on ice and heed the advice of Winston Wolf. (In case you don’t remember Wolf, he’s the “Pulp Fiction” character who used a rather colorful idiom to keep Vince and Jules’ ego in check.)
Microsoft is gaining market share, but at a very high cost. Bing has had the living hell marketed out of it, particularly on television. If all that money creates converts who consistently use Bing over Google, and market share keeps growing, it’ll be worth the cost. Right now I’m guessing whatever money Microsoft is earning from Bing is dwarfed by the search engine’s marketing budget. Microsoft has a long and proud history of losing a ton of money in a market area they want to enter and challenge a rival (see: Xbox gaming console.)
Now let’s look at the actual numbers and see just how far behind Google Bing really is, and how it may not be chipping away at the targeted rival at all, but actually stealing market share from its now partner, Yahoo.
From the first link:
Also from the first link:
Bing search engine may still be a bit player in the lucrative online search business dominated byGoogle, but it’s slowly and steadily gaining users. And it appears that Bing’s share is coming at the expense of both Google (GOOG) and Yahoo, the latter of which recentlyteamed up with Microsoft to be more competitive in online search.
A commenter at the link made a great point that some of this gain could be from Windows 7 users retaining — at least for now — the Bing default search engine option.
Whew, that’s some title up there and it’s the highly distilled — Twitteresque, even — news that it looks like Twitter is about to monetize in a very painless way. Most likely both Google and Microsoft’s Bing search engines will cut data mining deals with Twitter to leverage the power of Twitter’s real-time searchable information stream.
From the link (in bold is from me) :
The intense rivals (Google and MS) are in separate talks with the new online darling Twitter to set up their own data-mining deals , says a report from The Wall Street Journal ‘s AllThingsD Web site. The “advanced talks” are said to be over licensing deals that would allow them to integrate real-time Twitter feeds with their search engines, Google’s search and Microsoft’s Bing.
None of the three companies would respond to requests for information about the reported negotiations.
AllThingsD reported today that the individual deals could mean upfront payments worth several million dollars, or involve revenue-sharing plans.
“Ah, this could be a way for Twitter to make some money , and maybe more than just a little money,” said Dan Olds, an analyst with The Gabriel Consulting Co.
“It finally means a business model for Twitter, or at least the beginnings of one. And, of course, it means real revenue, which is very important. Not just in licensing revenue from Google or Microsoft, but also in potentially getting a piece of the action on an ongoing basis. So there could be considerable upside here for Twitter,” Olds said.
Disappointing and potentially lethal to the popularity of Bing, Microsoft’s reworked and rebranded search engine. The ad campaign was working, the Yahoo deal complete and it looked like Microsoft was doing something right in the search space.
And now this.
From the link:
Case in point: a search on Bing for the phrase, “Why is Windows so expensive?” returned this as the top link….
“Why are Macs so expensive.”
That’s right. You’re not hallucinating. That was the top response on Bing to a question about the price of Windows.
But it’s not just the top link. The rest of the links on the first search page don’t get much better. There is one link about the price of vinyl windows (actual windows that you look out), one on why Windows hosting providers are so expensive, and one about fish. The five other links on page one are about the expensive price of Macs. The Windows client OS is not even mentioned.
If Microsoft is going to resort to blocking and self-protection with their search engine, they could at least be subtle. This is about as subtle as a machine gun.
Also from the link:
The first of the search results about the Microsoft Word question linked to a page about how expensive Manhattan is (Is Microsoft competing with Manhattan now?). The top responses to the “Is Microsoft Evil?” question were, get this, a link to a New York Times story about whether or not Google is considered evil, a link about proxy servers, and a link to a story about Microsoft being charitable. Wow.
To be fair Microsoft has responded search results are based on an algorithm, blah, blah …
The results found in the linked article are more than fishy, and Microsoft is under a pretty heavy burden in public perception to avoid looking like, well looking exactly as the Redmond behemoth does right now.
There’s more out there in the online search space than Google, Microsoft’s Live … — er, Bing, and Yahoo. The new Wolfram|Alpha decision engine comes to mind.
Here’s five more search options from CIO.com.
Number three from the link:
Hunch is all about a decision engine, asking the user 10 questions or less to arrive at a solution to a problem or concern. At the core of the search site is a question selection algorithm built by Hunch’s small collection of Massachusetts Institute of Technology computer scientists with backgrounds in machine learning.
The design is such that questions are asked just like a human would structure a line of questioning. The questions asked vary based on what has already been asked and how it was answered.
And Hunch is another search engine with a social aspect. The smarts are a collection of common knowledge derived from users who can submit new topics, questions to ask and decision outcomes.Hunch says its algorithm is a mathematical framework married with a group of users who provide “personality by contributing to it and making it clever, funny, and nuanced.”
Bing is the latest incarnation of Microsoft’s search engine space efforts. I really don’t see how this latest rebranding will do anything in terms of market share for the Redmond behemoth, but I guess it won’t do any real harm either. Google is just dominant and the brand new engine with brand new tech in Wolfram Alpha will continue getting all the buzz.
Just on timing and the overall feel we’ve seen this before, I’m going to say this is another misfire from Microsoft.
From the link:
Microsoft’s latest vehicle for achieving the elusive goal of Web dominance is Bing. Previously known as Kumo while in development, Bing replaces Microsoft’s Live Searchbrand and carries forward the company’s strategy for taking on Google and Yahoo. Besides introducing a new look to Microsoft’s search interface, Bing adds a spruced-up navigation for search results, including a new left-hand navigation bar, a hover feature that lets users preview Web pages before visiting them, and a categorized search feature that groups search results by topic category.Microsoft’s CEO Steve Ballmer publically demonstrated Bing for the first time Tuesday at the D: All Things Digital technology conference. Bing goes live to the public beginning on June 3; it will be phased in over the course of several days.