Microsoft, Google step up web battle

01 June 2009

REDMOND, Washington: Microsoft and Google have intensified their efforts to attract increasing numbers of web users to their online portals, with the former announcing the launch of its new search engine, and the latter unveiling a new "conversational" messaging system.

As part of Microsoft's efforts to gain ground on Google in the online search market, Steve Ballmer, the company's chief executive, launched its new search engine, called Bing, at the D7 Conference, and revealed it will come into operation in June.

New tools offered by the system include "best match" results that link directly the authorised, official websites of brands and organisations, and providing "instant answers" to obvious questions.

It also features a shopping service that compares prices from various sources around the web, and rewards consumers that buy goods using Bing.

Ballmer did not reveal how much would be spent on marketing support for the new portal, which is identified as a "decision engine", and will have the tagline "The Sound of Found."

He did say, however, that "when I approved the budget, I gulped, and a gulp in a $60 billion (€42.5bn; £37.3bn) company, well, that's a big gulp."

Despite this, he predicted that Bing was unlikely to have an impact on Google's stranglehold of the market in the short term, as "there's no way to change the game in one step."

Allen Weiner, an analyst at Gartner, said Microsoft may now "have caught up with their competitors," but added that Bing "still represents the Web 1.0 approach to search, which basically gives links."

Google is also launching a new service, Google Wave, which the programme's developer, Lars Rasmussen, described as "what e-mail would look like if it was invented today."

Users of this system will be able to engage in a "conversation", which will form a string, or "wave", to which any of their contacts can contribute photos, messages or other content, all of which will be added in almost real time.

The "inbox" used by Google Wave will thus more resemble a "wall", as used on Facebook, rather than a traditional email system.

The move is seen as an effort to further establish Google's presence in the email and messaging sector, where Microsoft has a strong platform with its Hotmail and Instant Messenger systems.

However, Weiner argued that Microsoft may more easily be able to attract users to Bing than Google can to its new system, as the "switching costs in search are zero, but the switching costs in mail and messaging are pretty significant."

Data sourced from Financial Times/Wall Street Journal; additional content by WARC staff