With the arrival of the Bing search engine and the Microsoft-Yahoo search partnership, it's been a hectic summer for search -- not that you'll see market leader Google sweating.
Google CEO Eric Schmidt said back in June about Bing: "I don't think Bing's arrival has changed what we're doing. We are about search, we're about making things enormously successful, by virtue of innovation." For the most part Google is ignoring Bing, at least publicly. Google has not made any outward strategic moves that imply worry about Bing or the Microsoft-Yahoo partnership, other than to state that it's bad for innovation and competition.
Indeed, the Microsoft-Yahoo partnership will face the scrutiny of antitrust regulators and some experts question whether the partnership will be approved.
But if the partnership does pass legal muster, the search wizards in Mountain View will have a legitimate threat on deck. Microsoft has the money ($100 million is being spent on Bing marketing) and Yahoo has the users (98 million Yahoo Mail users in the United States, four times as many as Gmail). Both companies have the technology.
Google's plan, according to an upcoming Time magazine feature story, is to keep on innovating in search and let Microsoft mass market the heck out of Bing. But here are three reasons why quietly innovating may not be enough to keep the tenacious Microhoo at bay.
Microsoft CEO Steve Ballmer has made it clear that Microsoft's foray into search is not a flirtation, it's a marriage. He said at Bing's launch in late May: "Bing is an important first step forward in our long-term effort to deliver innovations in search."
Microsoft has said that it plans to spend 5 to 10 percent of its operating income on search over the next five years, a number that works out to be roughly $10 billion per year.
From the outset, Microsoft pointed all its guns at Google with Bing, working to make its interface warm and colorful and structure its search results into categories, as opposed to Google's minimalist interface and long list of links. The subsequent $100 million ad campaign for Bing has focused on how it is more organized and user-friendly than Google.
Google Doesn't Market Itself
Google is one of those companies, like Starbucks, that doesn't do much consumer advertising. Why should they? When your company name is a worldwide verb, you don't exactly need to get the word out. But with the Microsoft-Yahoo partnership, the ground is starting to shift under Google.
The Bing ads have changed perceptions. They rather humorously portray Google's search results as a random collection of links, many of them useless. If anything, the ads have made people question, for probably the first time, whether Google's search is the best way.
The Time magazine story mentions that Google's search engine does have features that most users don't even know about such as providing "the local weather and movie times and performing currency conversions with a single search query."
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