Critical mass
In a recent interview with Reuters, Microsoft's online SVP - Yusuf Mehdi - revealed that he thinks the deal it finally agreed with Yahoo last summer, which means Yahoo search will be powered by Bing, will give Bing a lot more credibility to advertisers and make it a viable alternative to Google.
"As soon as we close and implement the Yahoo deal, we have achieved a milestone: for advertisers, we are a credible No. 2," said Mehdi. "At 30 points we are now a credible option, so that number matters. The nice thing is we can say (to advertisers) you can be close to 30 percent share in one easy buy. That 30 percent carries a lot of weight in the marketplace."
According to ComScore, Bing currently has 10.7 percent of the US search marketplace, while Yahoo has 17.3. Their combined 28 percent is still less than half of Google's 65.7, but at least makes it a strong second.
As Google has found, search share equals cash, so gaining share remains the Holy Grail of Microsoft's online strategy. "Really now, the goal is about share gain. If we grow share, we will grow our way into profitability, and we have confidence we can do that," said Mehdi. "There's no question we intend to make a profit."
Reuters reckons Microsoft has blown more than five billion dollars (still less than three month's profit) over the past four years trying to develop its online business. Mehdi is optimistic Microsoft will eventually get a return on that investment, but doesn't underestimate Google.
"Clearly there's a huge return in the search marketplace that can more than make up the investments we've put in to this point," he said, before concluding "we're still outmanned and outgunned by Google, they still have way more engineers than we do."
