Opinion

Opinion: Microsoft and Yahoo still searching for Google's crown

My favourite of Apple's many jabs at Microsoft came in 2004, at the launch of OS X 10.4: "Redmond, start your photocopiers."

Few things illustrate the company's latter-day lack of vision better than its efforts to pursue Yahoo, beginning with a breathtaking $44bn buyout offer in February 2008, and culminating (for now) with a deal whereby Yahoo agrees to use Microsoft's search engine in exchange for various sweeteners. It was lucky for Microsoft that Yahoo's Jerry Yang rejected the initial offer; the new agreement makes more sense.

But why did the company ever contemplate so huge a spend on a declining icon of the web? "Google's dominance of search and search advertising continues to grow," says the official web site set up to announce the deal. "This lack of competition in search poses risks to consumers, advertisers, web publishers, and the entire Internet." Nervous words; and Microsoft seems convinced that it has to break Google's grip on search in order to thrive.

The reasoning goes something like this. Through search, Google has achieved three key business advantages. First, it is the world's portal to the Web. In Google Chrome, the difference between searching and browsing the web all-but disappears into a single "omnibox".  Second, it dominates search advertising, and advertising is the commercial engine of the Web. Third, by observing what people click, Google has access to data which it can use to improve its products. These are real advantages, which Microsoft wants to match.

Unfortunately Microsoft's response over the last few years has been desperately lacking in imagination. Once, the company could trounce a competitor by doing something similar and building it into Windows or Office. Those days are gone, especially on the Web, yet we have seen Live Maps vs Google Maps, Soapbox vs YouTube (a particularly dismal example), and the Live Search team trying everything: imitating Google's sparse interface, buying users with cashbacks, launching Bing with many features that were also in Google if you knew where to look, and now buying a sliver of market share from Yahoo.
 Microsoft's mapping  technology is actually high quality, and Bing is a worthy search engine. What is obvious though is that disrupting the market will require something different, not the same kind of thing done just about as well.

There are even clues about what that different thing might look like. Twitter betters Google for certain kinds of search, and the next generation is likely to blend social media and the real-time web with traditional indexes. Ironically, Yahoo has some interesting ideas along these lines, which are now under threat. "Five years from now, ten years from now, [search is] going to look very different than it does today. It will become more personalized, it will become more social," said co-founder David Filo at Yahoo Hack Day in London last May, where the company demonstrated some of the technology that might drive it.

Is it possible that Yahoo's imagination combined with Microsoft's resources might bring about genuine innovation in search? It is possible, but looking at Redmond's track record, hard to imagine.
 

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This was first published in August 2009

 

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