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Microsoft's Growing Search Loses  (Source: CNN)
Bing may never turn a profit

Microsoft has been trying to compete in the search market with its Bing engine and hasn't been doing well. Google is still the runaway king of search and Microsoft is showing little signs of offering up meaningful competition.

Microsoft is taking a beating with Bing, and CNN reports that the search engine is losing Microsoft almost a 
billion dollars per quarter. Since Bing launched in the summer of 2009, Microsoft has lost $5.5 billion on the service and the losses are flowing faster than ever today.

Not all of the losses can be blamed on Bing though. Apparently, Microsoft has never made money on its search offerings. Since it embarked into search arena, the total mount thrown away amounts to $9 billion.

Bing has 14.7% of the search market and is proud to proclaim it is gaining on Google and has taken share from the search giant. CNN, however, points out that the gain Bing has made in the search market is in fact not coming from Google, but third place Yahoo. Since Bing launched, Google has lost market share slightly from 65% at Bing's debut to 64.8% today.

Half of the gains Bing has made came from Yahoo according to CNN and the rest of the gains came from and AOL.

Microsoft is looking to build its market share with partnerships for search with Facebook and with Nokia. Microsoft and Nokia are tying up for a big push into the smartphone market with Nokia being a premiere Windows Phone 7 partner. 

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It could make more...
By Ranari on 9/22/2011 7:23:56 PM , Rating: 2
Bing will lose a lot more money until it finally makes a profit. Sadly, I think was probably an idea-too-late. People don't access the internet the same way they used to. I feel the idea was probably contrived back in the day when people would log into the internet through source providers. That is, you log into AOL, or Yahoo, or one of these media companies that would provide a portal gateway to the internet. This is back when the internet used to be like navigating troubled waters. People just have a lot more experience now than they did 5 years ago browsing the internet. They know what they want. They know what they're looking for, and I don't know of that many people that spend all of their time searching all day for things on the internet.

The second issue I have with Bing is that it's advertising portal, the Microsoft Adcenter, just isn't that easy to use. It's clunky. It's not very intuitive. It's painfully slow, too. It's also rather limited as well. How many potential small business advertisers are turned away from using Adcenter by their first experience? How many potential advertisers do you think are burned because they didn't know about a setting, and it ended up costing them hundreds of dollars. You know, a lot of the reason Google is successful is because they've developed an ad platform that "just works". Sure, it has its issues, but this is one area that Google has a huge leg-up on Microsoft, and they're losing millions because of it.

Then there's the issue with tracking. This involves more medium sized businesses, but I'd imagine they're a large revenue source if Microsoft would realize it. I have a few friends who work at SEO companies, and of the issues they have is that Adcenter advertisements are hard to track. A lot of the track programs are built with Google in mind, and not necessarily Adcenter. As a result, they don't advertise because they have a hard time justifying sales to dollars spent if they have no way of knowing if a Bing click converted or not. Sure, you can use the built in Adcenter tracking, which works, but companies rely on their own tools to do that. Google Analytics doesn't recognize Adcenter traffic out of the box. You have to program it in yourself, and Microsoft doesn't help you do that.

So there's a lot things Microsoft could do to improve their revenue here. I've heard through the grapevine that Bing is actually an amazing revenue source if you know how to use it. Conversion rates are high, and click costs are low. Sadly, it's too complicated to use for an individual with some SEO experience. If Microsoft could work on that, I think they'd trim down those $4B yearly losses in no time.

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