Bing’s market share hovers around 10%, but according to most sources, is increasing, though at a slow pace, and mostly at expense of Yahoo!. Even Google is advertising its music service on Bing! It continues to pose a viable threat to Google’s dominance, and by looking at just Bing, it would be hard to argue that elephants can’t dance! Would Bing continue to gain market share or would it get relatively stable somewhere in low double digits?
Earlier I wrote an article about Bing. Following are some of the statements I made almost 6 months ago:
“Fact that search market does not really have strong network effects does not help Google.”
“Fact that search market does not really have strong network effects does not help Google.”
We are indeed seeing signs of this. Though users are so used to using Google and it would take considerable time for them to switch to another search engine, they are not “locked in” the way they are with an operating system such as Windows. However, as we will see below, there are several ways Google is trying to “lock in” users by making Google the default search on Android devices for example.
“Microsoft has some additional advantages when it comes to advertising. Their real estate is much diverse than Google’s: they own operating system to Xbox to Office, used in most enterprises.”
Whatever additional advantage it might have had, Microsoft hasn’t been able to exploit it to its fullest yet. In fact, Google now might have an upper hand. Google has a huge portfolio of web apps, which it can leverage to offer a diverse portfolio to advertisers. The portfolio not only includes Google sites such as Gmail and Google Apps, but also third party sites who are part of a huge Google network. On top of it, Google’s foray into mobile with its Android operating system and recent acquisition of AdMob, if it goes smoothly, will only make it stronger.
A number of developments have happened since my earlier article, so let’s look at some of them in more detail.
Mobile
Google’s Android has made huge inroads in mobile space. Several vendors such as HTC and Samsung have reduced their Windows Mobile portfolio in favor of Android. As a matter of fact, Android is now considered the only worthwhile competitor to Apple’s iPhone. And while, Google’s presence in mobile operating systems is an important development, this isn’t really my key point here: Google’s ambitions in mobile are a lot bigger than might otherwise appear. It’s intentions are not only to make an offensive into mobile operating systems wars, but to defend its search dominance. Future of computing is undoubtedly moving away from computers and laptops to other devices such as smartphones, netbooks, tablets, and even e readers and consumer electronics. So while Google might feel fairly comfortable in web search, it does not in mobile search. And that is why it needs to have presence in mobile.
Google has also realized that a small delay in (mobile) search results in huge reduction of traffic to its site. Therefore it can not depend on other players to improve the mobile space, it needs to do so itself.
What it means is that it is even more important for Microsoft to make a strong come back with its Windows Mobile 7. While Bing app for iPhone is cool, it cannot compete with Google’s built in search for Android. What’s worse is that Microsoft hasn’t been aggressive in mobile advertising the way Google is.
Partnerships
Once Microsoft starts “powering” Yahoo! search, the share would further tilt into Microsoft’s favor. This will give it enough scale to then start attracting more advertisers and thus offering them an alternative to Google. This will certainly be a welcome news for advertisers who are essentially price takers from Google.
Bing offered free wifi to anyone who did one search using Bing at certain hotspots. It did look like a smart move, only until Google responded by offering free wifi for the season at most major US airports. Microsoft has deep pockets but so does Google!
The most interesting development however is Microsoft’s rumored offer to pay News Corp to allow Bing to list News Corp’s content. This came after News Corp threatened to block Google from accessing its content. While I am not sure whether this will happen – News Corp loses more than gains by blocking Google – it can certainly create problems for Google. If Google has to pay content providers to index their news, it would deeply erode into Google’s margins, thus threatening its “less than free” model.
Decision Engine
Bing is posing itself as a “decision engine”. It integrates well with certain vertical searches, such as travel search with its acquisition of Farecast. Google so far has proven my prediction, that Google would buy Kayak, wrong. I strongly think that it is going to hurt Google in the long run. More and more users would move to more relevant search engines such as Bing or Kayak for their specific searches such as travel, and e-commerce sites such as Amazon for needs such as shopping. How likely are you to search for Lady Gaga on Google, when your are ready to buy the album, than on iTunes or LaLa? Google would lose out on such “high premium customers, and advertisers would sooner or later figure out that someone’s chances of clicking on an ad are much higher when they are on a specific site such as Kayak than when they are on a horizontal search site such as Google.
Going Social
Bing announced a deal with Twitter to index real time search results. Microsoft’s excitement lasted only for a few hours only until Google made a similar announcement. And while there are a few pros and cons to each engine’s approach, I still think that both Google and Microsoft are struggling to find a way to stay relevant and as newer generation spends increasingly more time on social networks such as Facebook. Would Facebook be able to leverage high stickiness among its users to its advantage and make itself a popular search (or decision) engine (search for “balloon boy” on Facebook, and you will see web results at the bottom)?
User Interface vs Innovation
Bing announced a deal with Twitter to index real time search results. Microsoft’s excitement lasted only for a few hours only until Google made a similar announcement. And while there are a few pros and cons to each engine’s approach, I still think that both Google and Microsoft are struggling to find a way to stay relevant and as newer generation spends increasingly more time on social networks such as Facebook. Would Facebook be able to leverage high stickiness among its users to its advantage and make itself a popular search (or decision) engine (search for “balloon boy” on Facebook, and you will see web results at the bottom)?
User Interface vs Innovation
Bing’s interface is cool! Microsoft generally does a fine job at user interface, even if it takes inspiration from others (Apple for example). Google’s philosophy on the other hand is to keep things simple. Several experts argue that search engines wars now will be decided on the user interface and not innovation. For example, if you search for “Bing vs Google” on Bing vs Google, it’s really hard to tell who does a better job! To most users both results look comparable, even though I am sure that one indexes better than the other. However, I disagree that user interface would be a key differentiator in the long term.
Search technology is still rudimentary. For several questions, it takes several tries and therefore significant time to find the answer one is looking for. In an ideal world, search engine should be able to give me back exactly what I want without having me to worry what I should type in the search box! This is where I think Google is going to have an edge over time. It generally innovates faster and continues to make search more productive.
To sum it up, I thing Bing has done a phenomenal job and has a strong momentum behind it. However, it faces biggest threats from Microsoft’s fledgling position in mobile. Moreover, it needs to stay on top of innovation rather than just working on partnerships and building a sexy interface. Considering it has made such an impressive comeback I would give it a 4 out of 5, but due to its low market share and other doubts just shared above, I would settle at 3.
Score: 3/5
Scoring Explained:
1 -> in deep trouble
2 -> in bad shape, but there are chances of recovering
3 -> can’t say
4 -> in good shape, need to execute well
5 -> in great shape
2 -> in bad shape, but there are chances of recovering
3 -> can’t say
4 -> in good shape, need to execute well
5 -> in great shape
