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The Wall Street angst over Microsoft’s big bet on Internet search and advertising has given rise to a good deal of examination of how well Microsoft is doing in that regard. Are they building a powerhouse competitor or a Moogle (Microsoft’s inferior copy of Google)?
Microsoft, of course, would have us believe it is the former as they roll out adCenter which spices up Internet ad sales with viewer demographic information:
Microsoft’s adCenter, for instance, will incorporate a wealth of user demographic data into its ad-matching equations. Unlike Google, Microsoft knows a great deal about its customers. More than 250 million users have provided Microsoft some level of personal info, such as gender, age, and Zip Code, when signing up for various MSN services, such as a Hotmail account. Microsoft will lay this demographic data on top of contextual ad matches with the hope of providing a radically improved result. Microsoft insists that no personally identifiable info will be disclosed.Instead of simply bidding on words and phrases, MSN is betting that some advertisers will offer a larger payment if the Web surfer falls inside its target audience. For instance, Kentucky Fried Chicken (YUM ) could target women between 35 and 45 at dinnertime with hopes they’ll opt to buy a bucket of thighs and breasts instead of cooking. Or Neutrogena Corp. (JNJ ) could target one set of ads for its facial cleansers for men and another for women. “Search is a very, very blunt instrument,” says Joanne Bradford, vice-president and chief media revenue officer at Microsoft. “AdCenter is a tool that you have much more control over.”
Frankly, if that’s it, adCenter is hardly razor sharp. Google, of course, is relying on IP address location and search history to refine its results.
Henry Blodget is clearly in the Moogle camp in his blistering attack, MSN: Another Quarter Closer To Irrelevant:
Microsoft has been at the web business for 11 years now–and it is still running a distant third. How long Microsoft will continue to believe that gaining real traction online is just a matter of hiring the right people, developing the right algorithms, or spending the right amount of money remains a mystery. Unless the MSN division soon shows signs of first stabilizing and then regaining share, however, even the Microsoft faithful may eventually have to throw in the towel.
He recommends a spinoff as was the ultimate fate of other Microsoft Web properties such as Slate and Expedia, although it’s not clear how that would boost MSN in the search business as opposed to ensuring its doom.
However, on the flip side, Microsoft may have some advantage in just not being Google. The rumor from a week ago that eBay was soliciting help from Microsoft and Yahoo in fighting Google was subsequently denied by Steve Ballmer, but choosing an ad vendor for a content site seems like an ordinary business decision that could expect to be examined regularly. The conjecture that eBay management was incensed by Google’s recent forays into shopping might play a part in any decision, but neglects the fact that Microsoft and Yahoo have notable shopping sites of their own.
More concretely, Microsoft did manage to snag a search client away from Google over the weekend. Amazon’s A9 and Alexa searches are now “powered by Windows Live” :
Jeff Bezos hasn’t had much luck finding a winning recipe for entering the Web-search market. His previous formula — pluck an algorithms guru from Yahoo, add search results from Google, and stir up the Web world — didn’t attract many users. Meanwhile, Udi Manber, CEO of Amazon’s search subsidiary, has decamped for Google. Now Bezos is giving it another go by partnering with Microsoft. While Amazon’s move doesn’t do much for Microsoft’s paltry share of the search market, it’s a symbolic victory for Microsoft, which failed in a bid late last year to power AOL’s search results.
Amazon’s search properties are small potatoes (and ad-free), but something is better than nothing. As Nicholas Carr observes:
As Google has moved deeper into shopping services and book sales, it’s been on a collision course with Amazon. But my guess is that money was probably more important than strategy in this decision. The big question: What did Microsoft pay, and is this part of a larger deal? No word yet from the principals.
Once again this seems like an ordinary business decision where Microsoft can provide an alternative to the ubiquitous Google, although the current lack of ads makes it a special case.
LiveSide has been reporting that two new variants of Windows Live Search are on the way and Microsoft’s public relations firm Waggener Edstrom has confirmed it.
Windows Live Academic Search is targeted at academic journal searching like Google Scholar. There are more details here and here and it will be launched tomorrow, April 11.
Windows Live Product Search is apparently a rival to Google’s Froogle offering in providing shopping searches on product and price. Of course, this also competes with the multitude of shopping engines from Yahoo, Amazon, eBay, other specialized providers and not to be forgotten, MSN Shopping and Windows Live Shopping. Presumably there will be some sort of link up with the latter.
(Via Tech Crunch) It’s Web real estate, of course, but Microsoft’s Ian McAllister lets us know that the sign is up at http://shopping.live.com/. There are some sparse details in the linked “help wanted” posting which reveal that they are building the “the largest structured commercial catalog in the world, ingesting data from hundreds of thousands of retailers” in “50+ international markets.”
Interestingly, the hiring is for the whole MSN Marketplaces team which includes Windows Live Expo and MSN Shopping as well as Windows Live Shopping. Are we having brand confusion yet? Since MSN Shopping reported last Holiday season they had 7,000 retailers (which was, in itself, admirable growth), the folks at Microsoft clearly have high hopes for their new venue.
Of course, Windows Live Shopping isn’t the only new store on the street with high hopes. Colin Barker at ZDNet UK reports on Google Base:
Google is hoping to take on the huge task of moving a significant portion of the European retail sector online.
The company is extending Google Base, its system for advertising and selling goods and services, into a full retail operation, it revealed this week.
Some industry analysts are sceptical about Google’s prospects and have dismissed Google Base as “just advertising”. Another analyst believes that Google Base’s true worth goes beyond just retail and that its “rounded, more complete, approach” will make life tough for companies like Amazon.com and eBay.
Tough for Windows Live Shopping as well, of course. And along with the shopping comes the paying which is pretty good business too, as eBay discovered with PayPal. TechCrunch shows what the kids from Mountain View are up to in that arena with an Exclusive Look At Google Payments. I’m sure they’ll all find the competition bracing.
Bill Gates has talked about it, but Yahoo is actively exploring a rewards program for its search engine users:
Yahoo confirmed on Wednesday that it’s polling some Yahoo Mail users about what they would want in exchange for making Yahoo their primary search engine. The survey was sent to a random sampling representing about 5 percent of its Yahoo Mail users, a Yahoo representative said.
“Yahoo is considering launching a program to reward people who make Yahoo their primary search engine. Yahoo Mail users will be given early access to this program. You will receive a monthly reward if you make Yahoo your primary search engine. This means that most of the searching you do each month must be on Yahoo Search.”
Users would have to log in or use a search box specifically designed for the program, like “a Yahoo rewards toolbar,” the survey said.
It’s not really clear how this demonstrates that Yahoo is the “primary search engine” – it looks more like a credit card rewards program where a user would get rebates for usage. Hit the link for the sample list of proposed goodies, but the resemblance to a credit card rewards program is even more apparent. I wonder how long it would be before someone comes up with an automated Yahoo “search bot” to try to game the system. Anyhow, MSN Search has one more thing to worry about.
Update: Techdirt points to a similar but underpublicized program at Amazon’s A9 search engine:
Later that month, Amazon’s struggling A9 search engine began experimenting with a similar program, which few people noticed, because… well… few people notice A9.
Geekzone has more details and points to an Amazon explanation of the program. Basically after signing up and using A9 to some unspecified extent for a few days, the user qualifies for a 1.57% discount at Amazon. Once qualified, “as little as a few searches a week will keep you eligible.”
