9 ms·

Microsoft has lost $9 billion on Bing

162 points by bufo 15y ago

0x12 15y ago
> Stefan Weitz, Microsoft's director of Bing, believes that if Bing can change the way people think about search, sooner or later users will switch over from Google. For that to work people would have to change the way they think about microsoft as well, not how they think about search. Right now there are several ecosystems on the web that you can be part of. There is the 'social' ecosystem which governs you interactions with other people rather than with other services. Facebook, twitter, google+ etc. Then there is 'mobile', which is a gateway to a bunch of data and to information. Then there is your work and the applications you use to do that work. Finally there is search. Search is different from all the others in that you could switch overnight to a new provider, but just like any other good infrastructure component, you probably will not do that if you are satisfied with your current provider. Search is not visible enough to warrant a conscious decision until you are dissatisfied. Changing your thinking on search is one hurdle that is going to be hard to cross without say google going down for a couple of weeks or some major mishap that would make their search results unusable for any period of time. That would give an upstart a better chance at a first shot at retaining the users. Changing the way you think about microsoft is going to be a very hard obstacle to clear as well. Microsoft is synonymous with software that you use on your desktop and with several botched attempts at doing search. Before you try them again you'd have to see google performing worse than the best that microsoft has ever presented in this field. Frankly I'm surprised that they keep sinking money into this, they've clearly failed to establish a profitable beach head, meanwhile google is making money hand over fist in the exact same domain. I'm happy they do, more competition is better but for now google seems to be acing them. Microsoft will have to be very careful that 'search' does not turn in to their Afghanistan.
- arethuza 15y ago
  "For that to work people would have to change the way they think about microsoft as well" I honestly don't really care that Bing is part of Microsoft - if they consistently started finding noticeably "better" search results than Google I'd stop using Google in exactly the same way that I stopped using AltaVista/HotBot/etc. YMMV.
  - vegai 15y ago
    Then again, Google was new with no baggage of previous wrongdoings. Many people remember how Microsoft operated in the past (and I suppose, in the present).
    - arethuza 15y ago
      There were loads of search engines around when Google started - as far as I recall people started using them because their search results were dramatically better than what you'd get from other sites. Simple as that.
      - 0x12 15y ago
        Being dramatically better than google is a high hurdle. It's tough for competitors but google pretty much did an end-run around the search problem and to be just like google is not good enough a reason to switch. Now if someone would do to google what google did to altavista that would move the needle on many fronts. I suspect DDG is not it, but I'm not saying it is not possible.
        timr 15y ago
        "Being dramatically better than google is a high hurdle." Everyone likes to say that...but really, how do you know? By definition, disruption comes when you don't expect it. When Google came along, people didn't know that search could be made better. Likewise, today, people don't see what they're not getting with Google...they just know that Google's results cause about the same level of satisfaction as they always have. The search engine that gets a toehold against Google is going to do something completely different, and re-define the search game for all of the players. It's not going to be a head-to-head competition on the same playing field.
        beagle3 15y ago
        The change will not come from being better than Google at their own game (unless they start being incompetent), but rather from winning a different game that Google didn't pay attention to in time. That's how Facebook happened. In the mobile search space, pay attention to DoAT.com - it's mobile search done right, unlike google (or anyone else). If they gain enough traction, they can dethrone google eventually. Or it could just be a passing fad. It's rare to win an established game, like Google did with search (or Microsoft did 20 years ago with word processing and spreadsheets). It's much more common to win at a new game that is being overlooked by the giants. (Some people say the Microsoft takeover of the office space is "a different game" because no one took "office suites" seriously except them; However, Word really was better than WordPerfect and friends at the time; and Excel really was better than 1-2-3, and people were switching one-package-at-a-time. So I think this should be considered winning an established game)
- dabeeeenster 15y ago
  I bet if you asked 100 people in the street who owned bing, less than 10 would say Microsoft.
  - mike-cardwell 15y ago
    You're being generous. At least 98 of them would say, "What's Bing?". Almost certainly more.
    - dasil003 15y ago
      Bing has had pretty heavy marketing. I'm guessing 10% would have at least heard of it in a major city.
  - galactus 15y ago
    And probably none of them would find that to be bad in itself.
  - suivix 15y ago
    That's because the other 90+ would have no clue what you're talking about.
- pessimizer 15y ago
  >Frankly I'm surprised that they keep sinking money into this, they've clearly failed to establish a profitable beach head, meanwhile google is making money hand over fist in the exact same domain. This seems to be Microsoft's MO, and it seems to have worked with the XBox. Push hard, buy a second place position with massive marketing, investment, and underpricing, and continue to maintain it while losing billions and billions. Then the first place company inevitably, eventually makes a series of horrible, very public missteps, and Microsoft is positioned as "The Alternative." On one hand, I think it's a pretty sleazy tactic, but on the other hand I rarely ever see any corporation thinking in the long term, especially to this absurd degree. I'm not exactly sure what the strategy is to defend against this, either.
  - w1ntermute 15y ago
    I don't think you can compare the two situations, because Sony has gone to great lengths to demonstrate that it's a supremely incompetent company (which it is). Google has done nothing of the sort. Plus, people constantly expect innovation from the console makers, but for Google to hold on to its position in search, it just has to stay online.
    - markokocic 15y ago
      While Google reputation has been superb so far, at least for normal users, their push for Google+ may change that. It's kind of "all in" move by Google. If Google+ succeeds, their brand will be even stronger, and as king of data, search and social they will stay leaders for the long time, giving them possibility to attack other market segments too. But if Google+ fails, Google brand will be severely damaged, and normals could go somewhere else. All Microsoft has to do here is to wait for the outcome and actively try to sabotage Google+ efforts by working together with Facebook.
      - sausagefeet 15y ago
        I don't think G+ failing really damages Google's brand that much. It will just be another service people don't use on Google while they are searching.
- billybob 15y ago
  "Microsoft is synonymous with software that you use on your desktop" This is insightful. While some of us geeks have a grudge against Microsoft, most people don't. They probably do, however, have a mental separation between the desktop and the web. Microsoft was slow to embrace the web because it threatens their core products. So the web grew without them. Now they're saying, "oh, we're on the web, too!" But when people think of the web, they don't think of Microsoft. They missed the chance to make that association. And it's hard to get it back.
  - patio11 15y ago
    They probably do, however, have a mental separation between the desktop and the web. I think most users couldn't describe the difference between these two if their life depended on it, FWIW. Ever met someone who referred to Excel as a web site?
    - euroclydon 15y ago
      Yes, for the two CWC customers who managed to find my phone number and call me, my question, "What web browser are you using?" was met with a long pause.
      - rmc 15y ago
        They were probably using Google for their internet, but they might not have installed a browser yet.
    - libraryatnight 15y ago
      A startling number of people believe that the internet IS Internet Explorer.
      - deleted 15y ago
        [deleted]
  - RyanMcGreal 15y ago
    I suspect that for most general users the web still equates with the big blue "e".
- webwright 15y ago
  Great points. This guy ( http://worldofsu.com/philipsu/?p=209 http://worldofsu.com/philipsu/?p=209 ) mentions that users prefer bing results over google results when the put a google logo above them (no source cited, tho). That's got to be maddening... But yeah, it's a brand problem as much as it's a product problem.
  - voodoomagicman 15y ago
    I would be interested to hear which results users prefer when there are no logos at all. I did a blind search engine test about the time that Bing launched, and oddly enough for the queries I tried, I picked Yahoo (pre bing) as having the best results most often. I still use Google though, so maybe it really is all about the logo for me...
    - moultano 15y ago
      The queries people do when testing a search engine are very different from the queries they do in real life. For starters, the first thing people do to test a search engine is to search for their own name.
    - finisterre 15y ago
      Blekko's "search engine monte" provides blinded results from their own search as well as from Google and Bing [1], so you can perform your own experiments. 1. http://blekko.com/ws/hacker+news+/monte http://blekko.com/ws/hacker+news+/monte
  - thefool 15y ago
    All I know is that at school when I'm on public computers, sometimes I'll accidentally use bing without noticing, do a couple queries, get frustrated by not finding the link that I'm looking for (often a course website), notice I'm using bing, and switch over.
- Lewisham 15y ago
  Frankly I'm surprised that they keep sinking money into this, they've clearly failed to establish a profitable beach head, meanwhile google is making money hand over fist in the exact same domain. Well, what else are they going to do? It's very clear that in the foreseeable technological future, search will continue to be an immensely important lynchpin of all sorts of services. Microsoft are in this because they realize that. You can't walk away from this table, however much you're losing. Bing is definitely going to be bouyed by the Xbox, Windows Mobile and Windows 8 integration, so that's good. FWIW, I like Bing, and I want them to do well. The results aren't as good as Google's yet, but their ancillary properties, like image search are pretty good. Video search is certainly better than Google's half-baked offering.
- credo 15y ago
  >>For that to work people would have to change the way they think about microsoft as well This thread is a great example of the problems Microsoft faces among HNers, but I don't think the general public has such a blatant bias against Microsoft. For instance, this topic was submitted 9 hours ago, has 128 points and is on the front page. It also has a false title.The title asserts that "Microsoft has lost $9 billion on Bing". However, the CNN article doesn't have this title. The article says that Microsoft "has lost $5.5 billion on Bing since the search service launched in June 2009". Now, HN moderators often heavy-handedly change submission titles on the grounds that the title violates some obscure HN rule (like for example, the rule that "X ways to optimize your app" is inappropriate) In this case, we have a much more blatant rule violation - changing the original title of the story and substituting it with a false assertion. Yet, none of the moderators have changed the title of this story.
  - cshenoy 15y ago
    If you kept reading the paragraph you quote, it also says "since Microsoft began breaking out that unit's finances in 2007, the company has lost a total of $9 billion." While the title of this post is not stating a clear timeline for the loss, it still is technically correct. And the original comment you're referring to isn't stating a clear bias against Microsoft, per se. It's more that they're stating a general perception: that Microsoft is Windows and that it's mostly a desktop software provider. I think we can all agree that the general public agrees with that. Don't worry - not all of us are out to get Microsoft.
    - credo 15y ago
      Wrong again. The online services division has lost $9B since 2007. "online services division" is not the same as "Bing". It is a division which (over the years) has included several different products/services. Bing (created in 2009) is one of those services. MSN used to be (and may still be) part of that division.
  - epo 15y ago
    Agreed, the $9Bn refers to declared losses by the online services division. However you come across as claiming that Microsoft is being victimised by a conspiracy of unreasoning and unreasonable hatred by HNers and the mods. "Blatant bias"? Really? I would suggest that people (not just HNers) know exactly what Microsoft is like and how badly they have behaved, if people are biased against Microsoft it is for a good reason. Microsoft have earned their reputation.
- TheCondor 15y ago
  I think it's more than that. Are they after some holy question in 'search?' Or are they really after the ad money? To me, it seems like if they think Google has just not delivered or dropped the ball or something regarding search, then Bing really fails to deliver. I have a hard time calling it better than Google and a really really hard time seeing it being better enough to switch. It just doesn't do that much more. If they're doing search, then the clearly need to do it better right? Not simply as good. Is it just arroagance that they can deliver some that merely matches or approaches Google and expect to eventually win? What makes them think that? It doesn't appear to be supported by any facts.
  - chakde 15y ago
    Personally I don't think there's any doubt that Google's search quality has fallen down over the last few years. There have been a few instances where what I was looking for was not found on Google and I gave up looking for it. Later (after a few months!) when by chance I tried the same query on Bing, the results showed up right on the first page. Surprised by this, I rechecked it on Google and it appears either on the 3rd or 4th page - something I would never check earlier. Since then I started always doing a backup search on Bing for anything important, to see results I might have missed on Google. By now, I'm using them 50:50. Also attended a lecture on Bing search, and learnt that their approach is a little different, which could acount for this observation.
makecheck 15y ago
Please retain original article titles as per the guidelines [1]. In this case, the new title is also inaccurate. This article is actually called "Microsoft's plan to stop Bing's $1 billion bleeding", and the loss on Bing alone is $5.5 billion since mid-2009. It was only Microsoft's total online services division losses that reached $9 billion, and that was since 2007. [1] http://ycombinator.com/newsguidelines.html http://ycombinator.com/newsguidelines.html
- puredemo 15y ago
  I wonder what else is in the online services division?
  - 0x12 15y ago
    MSN, messenger.
    - stumm 15y ago
      I think messenger is part of windows live, which I've been told falls under the windows umbrella.
  - deleted 15y ago
    [deleted]
  - jeroen 15y ago
    From http://careers.microsoft.com/careers/en/es/onlineservices.aspx http://careers.microsoft.com/careers/en/es/onlineservices.as... : Bing, MSN, MS Advertising, Global Foundation Service (the infrastructure)
ramchip 15y ago
"Bing will likely be better than Google over time, but even if it is, users and advertisers still need to go to them," said Sid Parakh, analyst at McAdams Wright Ragen. "To be clear, this will take a long, long time to play out. This is something Microsoft will continue to lose money on." That's an example of an annoying tendency that I see in many news sources. Why is a vague quote from an investment advisor relevant here? Who is Sid Parakh and what justifies his opinion? I see nothing related to search on his linkedin profile, at least.
- brown9-2 15y ago
  Even more, why does Sid Parakh believe that Bing will "likely" be better over time? He doesn't even qualify his own statements.
  - jaredmck 15y ago
    It seems unlikely that bing will be better over time, since google has more data and will continue amassing more click-through data with which to improve the results.
- keepsearching 15y ago
  Because McAdams Wright Ragen paid a PR firm to get mentioned on CNN. Now Sid is what's known as a "source".
dave_sullivan 15y ago
Sounds like bing probably represents better bang for your advertising buck than google at this point. Could be good deals there for marketers. For microsoft's part, it just seems like they're always one step behind google, which is one step behind Facebook, which sooner or later will be one step behind someone else when they've maxed their revenue from their current business and feel compelled to stray from their core competencies. History repeats itself and the young grow old. Also, thought it was an interesting bit about bing gaining marketshare from yahoo (their partner) and not google. Ouch.
- danmaz74 15y ago
  It could be a big bang for the buck, but you're limited to only 15% of the users...
- dasil003 15y ago
  I don't like this idea of companies being one step behind. I mean, yes, Bing is one step behind Google (in some regards anyway). And Google+ is one step (or a dozen) behind Facebook. But it's not like the new hotness invalidates existing business models. Where things are most interesting is where companies compete by embracing their own values (eg. Android vs iOS). I know Microsoft is famous for copying others' innovations, and back in the 90s they did it quite effectively, but for a lot of companies it feels like grasping at straws during their decline. I'd rather see companies focus on their strengths. You never hear people talking about how Amazon is "one step behind" all the newer sexier companies, and they're still on the bleeding edge.
  - dave_sullivan 15y ago
    It's not so much that the new hotness invalidates existing business models--I don't think it does--it's more that wildly successful business models will suffer from the law of decreasing returns sooner or later and this causes companies to go into areas they wouldn't normally if investors were not so focused on continued hyper growth and the new new thing. So if I'm reading you right, I think we agree on the point, if not the analogy :-)
danmaz74 15y ago
The examples of "semantic search" reported in the article don't look innovative at all to me. Giving you specialized results (eg maps) based on the search query has been done for ages, and expanding on that can be useful but it will hardly be revolutionary. Moreover, trying to guess the semantics of user's queries can be very annoying to some users, especially the geekier ones which are often also the trend setters in this area - there are lots of people already being pissed off by google when they search for synonyms of what you type, and not exactly what you type. Competition is always good and I hope that Bing and Google will make search always better, but I'm not so sure how useful will be what was reported in this article.
- mturmon 15y ago
  The article is thin on the use cases of semantic search, which is the market Bing says it's trying to serve ("a decision support tool"). The article raises the question of "how will Bing make money" and then drops the question, and goes on to talk about competing with Google. Lazy thinking by the writer.
mattmanser 15y ago
One wonders why with an apparent 15% share they're losing so much? Also find it interesting that they're gaining share, while the article states it's from other providers but Google, doesn't that still mean that these users are actually choosing Bing over Google? That they're chosen it because it's better?
- brown9-2 15y ago
  They are losing money because they are pouring money into buying that 15% with advertising, deals with mobile carriers, etc. The division also has thousands of employees. Bing is not like a small but scrappy startup who can make a profit off their small market share because they are lean.
bane 15y ago
The sad thing is that they are spending this on a fight that's largely been over for a few years. Hell, the social fight is nearing a conclusion were it not for g+, MS is not just trailing in the Internet space, they are in a time machine.
alttag 15y ago
I suspect part of Google's success is not just front-page search but also site-specific searches (how some sites use Google as a a back-end search). Perhaps more significant is their number of AdSense affiliates. (After all, search doesn't make money, advertising does.) Blog after blog and developer and developer continue to embed Google ads, and are thus themselves bound to Google and encouraging others to do so.
bergie 15y ago
From last year: When you hear the word “startup”, you most likely think of an Internet startup. Maybe it’s funded, maybe not, but its burn rate almost for sure puts it in the red each quarter. Obviously, Microsoft is not a startup. Nor have they been a startup for a long time. But what if you thought of their Online Division as an Internet startup? One funded by Microsoft. The thought it terrifying. Or it should be. To Microsoft. Microsoft released their Q1 2011 earnings today. The results were very good except for one very big blemish: the Online Division. Last quarter, the division lost $560 million for Microsoft. That’s better than the previous quarter when it lost a staggering $696 million, but it’s much worse than a year ago, when it lost $477 million. In the past year, Microsoft has lost well over $2 billion from the division. http://techcrunch.com/2010/10/28/microsoft-online-business/ http://techcrunch.com/2010/10/28/microsoft-online-business/
olliesaunders 15y ago
I get that Bing is no success, but how is it losing so much money? That can’t just be developer salaries can it?
- icebraining 15y ago
  Marketing.
- dillona 15y ago
  Advertising I'd imagine
pnathan 15y ago
Well, Bing always feels slow and 'baroque' in visual looks. Google always is fast and has a very clean visual look. Duckduckgo is slow and has a clean visual look (and doesn't track me). I use DDG. :-)
joelthelion 15y ago
As much as I'm happy to see Microsoft losing money, this is actually very bad news. Any competition for Google is a good thing, and at this rate it won't be long before Microsoft cuts expenses on Bing...
brudgers 15y ago
Another half assed analysis of Microsoft's Online Services Division. OSD includes Bing, MSN, Live Mail and Messenger...aka support services they provide to their internal and external customers (e.g. Windows Phone 7 uses Live Mail). It doesn't include profit centers like Xbox Live or their various enterprise level cloud services. OSD is primarily a cost center for marketing. Microsoft attributes half the value of its goodwill to OSD (US $6B). [http://www.microsoft.com/investor/EarningsAndFinancials/Earnings/FinancialStatements/FY11/Q1/IRFinancialStatementsPopups.aspx?tag=msft:GoodwillDisclosureTextBlock&title=Goodwill http://www.microsoft.com/investor/EarningsAndFinancials/Earn...] In addition, it's revenues don't reflect any savings Microsoft realizes by advertising it's own products on it's own ad network or by promoting its own brands on MSN (e.g. stories from MSNBC). Finally, the value of the data collected by the OSD is not directly reflected as revenue. That data provides Microsoft with insight regarding search, shopping, social networks, news interests, etc.
- kooshball 15y ago
  All Windows Live properties are in the "Windows and Windows Live" division under Sinofsky. Not in OSD. http://en.wikipedia.org/wiki/Microsoft#Windows_.26_Windows_Live_Division.2C_Server_and_Tools.2C_Online_Services_Division http://en.wikipedia.org/wiki/Microsoft#Windows_.26_Windows_L...
kablamo 15y ago
Thats a lot of money. Is duckduckgo profitable yet? I bet its not losing $1 billion per quarter. But then again I suppose Bing has hugely more market share than duckduckgo.
chrismealy 15y ago
A couple of years ago they'd lost something like $8 to $10 billion on xbox too.
forkandwait 15y ago
Why I don't use Bing: 1. I hate the stupid pictures and the other stupid fluff. 2. It is called "Bing" (the only worse brand name is "Yaris"... what are they thinking?) 3. Microsoft doesn't help fund and staff a LOT of the Free software infrastructue I depend on.
- IanDrake 15y ago
  >It is called "Bing" I've always wondered about names...is Bing only a bad name because they haven't been successful? Is Google only a good name because they've been incredibly successful? I wonder how many people said the same thing about Google 12 years ago?
  - gamble 15y ago
    I still see Google as a silly name, but at least it has some rationale in the corporate philosophy and a hint of geek cred. "Bing" just smacks of a committee of corporate drones trying to look hip with an unintentional parody of younger, cooler Web 2.0 company names.
JoshTriplett 15y ago
Providing the same services as Google will not get people to switch from Google, even if Bing provided somewhat better results. Google got people to switch because they didn't just provide astonishingly better results, they did things quite differently than others. If Bing wanted people to switch, they have to do something different, not just do the same things "better". Bing can't win by offering "a better way to Google": http://www.youtube.com/watch?v=tYVCk10AzS0 http://www.youtube.com/watch?v=tYVCk10AzS0
Aloisius 15y ago
The one thing you can say for Microsoft is that they stick to their guns and keep trying. With Google, you never know if a product has a team behind it or it was someone's side project that got out of hand and received too much press that they'll kill a couple in a couple months because it didn't get enough traction. Now sure, in the startup world the idea of sticking with an idea and plotting along losing money is a terrible sign, but on a personal level I can't help admiring Microsoft's fierce tenacity.
iamelgringo 15y ago
In certain verticals, Bing really outshines Google like travel search, video search, and image search. Bing maps is really quite good. Microsoft is a cash cow, and has multiple sources of strong revenue. Google has one: advertising. Microsoft can afford to bleed cash for years, just to give Google a black eye. Microsoft only this past year got out from under government oversight for antitrust violations. I've spent quite a bit of time talking to people at Microsoft the past 2 years. A lot of the BizSpark team are ex-Sun people. And a number of them have mentioned to me how shocked they were at how profoundly the anti trust litigation still affected employees within the company 10 years later. Windows 8 is the first OS since ME that comes out without government anti trust oversight, and it looks like Microsoft has come out swinging, both at Apple and Google. http://channel9.msdn.com/Events/BUILD/BUILD2011/KEY-0001 http://channel9.msdn.com/Events/BUILD/BUILD2011/KEY-0001 Google is just now starting to get into anti trust how water, and I have no idea how they are going to get out of it. I think Yelp in particular has a really strong case: http://www.pcworld.com/article/240330/google_faces_antitrust_accusers_expedia_nextag_and_yelp_wednesday.html http://www.pcworld.com/article/240330/google_faces_antitrust...
- wavephorm 15y ago
  Microsoft can afford to bleed cash for years Except that's exactly what they've been doing for a long time now. Microsoft reminds me of a cliche fat cat executive who's always red in the face, yells and bosses everyone around, and acts like he's invincible... until he keels over from a heart attack.
  - barista 15y ago
    Except that for pretty much every year it has been in business the revenue and the profits have been growing.
    - wavephorm 15y ago
      Sure the company as a whole is profitable. But if their internet businesses were it's own company, and run in this manner, they wouldn't survive. They're sure good at keeping up an appearance of extreme arrogance.
bstar77 15y ago
I think that I have a similar problem to many other users... It's not that Bing is a bad product, it may be the best thing out there. The problem is that I've lost confidence in Microsoft as a company to objectively serve me information. It's a trust issues that I don't have with Google or Apple... yet. Those companies have their warts too, but nothing like I experienced in the 20+ years I was locked into the MS ecosystem. As long as a guy like Steve Ballmer is running the company, I will stay far away. Perhaps when management changes down the road result in MS better demonstrating that they are more interested in producing great products rather than gaining market share at any cost, I'll take them seriously again. We're starting to see some of that with windows mobile and win8.

162 points by bufo 15y ago

0x12 15y ago

> Stefan Weitz, Microsoft's director of Bing, believes that if Bing can change the way people think about search, sooner or later users will switch over from Google. For that to work people would have to change the way they think about microsoft as well, not how they think about search. Right now there are several ecosystems on the web that you can be part of. There is the 'social' ecosystem which governs you interactions with other people rather than with other services. Facebook, twitter, google+ etc. Then there is 'mobile', which is a gateway to a bunch of data and to information. Then there is your work and the applications you use to do that work. Finally there is search. Search is different from all the others in that you could switch overnight to a new provider, but just like any other good infrastructure component, you probably will not do that if you are satisfied with your current provider. Search is not visible enough to warrant a conscious decision until you are dissatisfied. Changing your thinking on search is one hurdle that is going to be hard to cross without say google going down for a couple of weeks or some major mishap that would make their search results unusable for any period of time. That would give an upstart a better chance at a first shot at retaining the users. Changing the way you think about microsoft is going to be a very hard obstacle to clear as well. Microsoft is synonymous with software that you use on your desktop and with several botched attempts at doing search. Before you try them again you'd have to see google performing worse than the best that microsoft has ever presented in this field. Frankly I'm surprised that they keep sinking money into this, they've clearly failed to establish a profitable beach head, meanwhile google is making money hand over fist in the exact same domain. I'm happy they do, more competition is better but for now google seems to be acing them. Microsoft will have to be very careful that 'search' does not turn in to their Afghanistan.

arethuza 15y ago
"For that to work people would have to change the way they think about microsoft as well" I honestly don't really care that Bing is part of Microsoft - if they consistently started finding noticeably "better" search results than Google I'd stop using Google in exactly the same way that I stopped using AltaVista/HotBot/etc. YMMV.
- vegai 15y ago
  Then again, Google was new with no baggage of previous wrongdoings. Many people remember how Microsoft operated in the past (and I suppose, in the present).
  - arethuza 15y ago
    There were loads of search engines around when Google started - as far as I recall people started using them because their search results were dramatically better than what you'd get from other sites. Simple as that.
    - 0x12 15y ago
      Being dramatically better than google is a high hurdle. It's tough for competitors but google pretty much did an end-run around the search problem and to be just like google is not good enough a reason to switch. Now if someone would do to google what google did to altavista that would move the needle on many fronts. I suspect DDG is not it, but I'm not saying it is not possible.
      - timr 15y ago
        "Being dramatically better than google is a high hurdle." Everyone likes to say that...but really, how do you know? By definition, disruption comes when you don't expect it. When Google came along, people didn't know that search could be made better. Likewise, today, people don't see what they're not getting with Google...they just know that Google's results cause about the same level of satisfaction as they always have. The search engine that gets a toehold against Google is going to do something completely different, and re-define the search game for all of the players. It's not going to be a head-to-head competition on the same playing field.
      - beagle3 15y ago
        The change will not come from being better than Google at their own game (unless they start being incompetent), but rather from winning a different game that Google didn't pay attention to in time. That's how Facebook happened. In the mobile search space, pay attention to DoAT.com - it's mobile search done right, unlike google (or anyone else). If they gain enough traction, they can dethrone google eventually. Or it could just be a passing fad. It's rare to win an established game, like Google did with search (or Microsoft did 20 years ago with word processing and spreadsheets). It's much more common to win at a new game that is being overlooked by the giants. (Some people say the Microsoft takeover of the office space is "a different game" because no one took "office suites" seriously except them; However, Word really was better than WordPerfect and friends at the time; and Excel really was better than 1-2-3, and people were switching one-package-at-a-time. So I think this should be considered winning an established game)
dabeeeenster 15y ago
I bet if you asked 100 people in the street who owned bing, less than 10 would say Microsoft.
- mike-cardwell 15y ago
  You're being generous. At least 98 of them would say, "What's Bing?". Almost certainly more.
  - dasil003 15y ago
    Bing has had pretty heavy marketing. I'm guessing 10% would have at least heard of it in a major city.
- galactus 15y ago
  And probably none of them would find that to be bad in itself.
- suivix 15y ago
  That's because the other 90+ would have no clue what you're talking about.
pessimizer 15y ago
>Frankly I'm surprised that they keep sinking money into this, they've clearly failed to establish a profitable beach head, meanwhile google is making money hand over fist in the exact same domain. This seems to be Microsoft's MO, and it seems to have worked with the XBox. Push hard, buy a second place position with massive marketing, investment, and underpricing, and continue to maintain it while losing billions and billions. Then the first place company inevitably, eventually makes a series of horrible, very public missteps, and Microsoft is positioned as "The Alternative." On one hand, I think it's a pretty sleazy tactic, but on the other hand I rarely ever see any corporation thinking in the long term, especially to this absurd degree. I'm not exactly sure what the strategy is to defend against this, either.
- w1ntermute 15y ago
  I don't think you can compare the two situations, because Sony has gone to great lengths to demonstrate that it's a supremely incompetent company (which it is). Google has done nothing of the sort. Plus, people constantly expect innovation from the console makers, but for Google to hold on to its position in search, it just has to stay online.
  - markokocic 15y ago
    While Google reputation has been superb so far, at least for normal users, their push for Google+ may change that. It's kind of "all in" move by Google. If Google+ succeeds, their brand will be even stronger, and as king of data, search and social they will stay leaders for the long time, giving them possibility to attack other market segments too. But if Google+ fails, Google brand will be severely damaged, and normals could go somewhere else. All Microsoft has to do here is to wait for the outcome and actively try to sabotage Google+ efforts by working together with Facebook.
    - sausagefeet 15y ago
      I don't think G+ failing really damages Google's brand that much. It will just be another service people don't use on Google while they are searching.
billybob 15y ago
"Microsoft is synonymous with software that you use on your desktop" This is insightful. While some of us geeks have a grudge against Microsoft, most people don't. They probably do, however, have a mental separation between the desktop and the web. Microsoft was slow to embrace the web because it threatens their core products. So the web grew without them. Now they're saying, "oh, we're on the web, too!" But when people think of the web, they don't think of Microsoft. They missed the chance to make that association. And it's hard to get it back.
- patio11 15y ago
  They probably do, however, have a mental separation between the desktop and the web. I think most users couldn't describe the difference between these two if their life depended on it, FWIW. Ever met someone who referred to Excel as a web site?
  - euroclydon 15y ago
    Yes, for the two CWC customers who managed to find my phone number and call me, my question, "What web browser are you using?" was met with a long pause.
    - rmc 15y ago
      They were probably using Google for their internet, but they might not have installed a browser yet.
  - libraryatnight 15y ago
    A startling number of people believe that the internet IS Internet Explorer.
    - deleted 15y ago
      [deleted]
- RyanMcGreal 15y ago
  I suspect that for most general users the web still equates with the big blue "e".
webwright 15y ago
Great points. This guy ( http://worldofsu.com/philipsu/?p=209 http://worldofsu.com/philipsu/?p=209 ) mentions that users prefer bing results over google results when the put a google logo above them (no source cited, tho). That's got to be maddening... But yeah, it's a brand problem as much as it's a product problem.
- voodoomagicman 15y ago
  I would be interested to hear which results users prefer when there are no logos at all. I did a blind search engine test about the time that Bing launched, and oddly enough for the queries I tried, I picked Yahoo (pre bing) as having the best results most often. I still use Google though, so maybe it really is all about the logo for me...
  - moultano 15y ago
    The queries people do when testing a search engine are very different from the queries they do in real life. For starters, the first thing people do to test a search engine is to search for their own name.
  - finisterre 15y ago
    Blekko's "search engine monte" provides blinded results from their own search as well as from Google and Bing [1], so you can perform your own experiments. 1. http://blekko.com/ws/hacker+news+/monte http://blekko.com/ws/hacker+news+/monte
- thefool 15y ago
  All I know is that at school when I'm on public computers, sometimes I'll accidentally use bing without noticing, do a couple queries, get frustrated by not finding the link that I'm looking for (often a course website), notice I'm using bing, and switch over.
Lewisham 15y ago
Frankly I'm surprised that they keep sinking money into this, they've clearly failed to establish a profitable beach head, meanwhile google is making money hand over fist in the exact same domain. Well, what else are they going to do? It's very clear that in the foreseeable technological future, search will continue to be an immensely important lynchpin of all sorts of services. Microsoft are in this because they realize that. You can't walk away from this table, however much you're losing. Bing is definitely going to be bouyed by the Xbox, Windows Mobile and Windows 8 integration, so that's good. FWIW, I like Bing, and I want them to do well. The results aren't as good as Google's yet, but their ancillary properties, like image search are pretty good. Video search is certainly better than Google's half-baked offering.
credo 15y ago
>>For that to work people would have to change the way they think about microsoft as well This thread is a great example of the problems Microsoft faces among HNers, but I don't think the general public has such a blatant bias against Microsoft. For instance, this topic was submitted 9 hours ago, has 128 points and is on the front page. It also has a false title.The title asserts that "Microsoft has lost $9 billion on Bing". However, the CNN article doesn't have this title. The article says that Microsoft "has lost $5.5 billion on Bing since the search service launched in June 2009". Now, HN moderators often heavy-handedly change submission titles on the grounds that the title violates some obscure HN rule (like for example, the rule that "X ways to optimize your app" is inappropriate) In this case, we have a much more blatant rule violation - changing the original title of the story and substituting it with a false assertion. Yet, none of the moderators have changed the title of this story.
- cshenoy 15y ago
  If you kept reading the paragraph you quote, it also says "since Microsoft began breaking out that unit's finances in 2007, the company has lost a total of $9 billion." While the title of this post is not stating a clear timeline for the loss, it still is technically correct. And the original comment you're referring to isn't stating a clear bias against Microsoft, per se. It's more that they're stating a general perception: that Microsoft is Windows and that it's mostly a desktop software provider. I think we can all agree that the general public agrees with that. Don't worry - not all of us are out to get Microsoft.
  - credo 15y ago
    Wrong again. The online services division has lost $9B since 2007. "online services division" is not the same as "Bing". It is a division which (over the years) has included several different products/services. Bing (created in 2009) is one of those services. MSN used to be (and may still be) part of that division.
- epo 15y ago
  Agreed, the $9Bn refers to declared losses by the online services division. However you come across as claiming that Microsoft is being victimised by a conspiracy of unreasoning and unreasonable hatred by HNers and the mods. "Blatant bias"? Really? I would suggest that people (not just HNers) know exactly what Microsoft is like and how badly they have behaved, if people are biased against Microsoft it is for a good reason. Microsoft have earned their reputation.
TheCondor 15y ago
I think it's more than that. Are they after some holy question in 'search?' Or are they really after the ad money? To me, it seems like if they think Google has just not delivered or dropped the ball or something regarding search, then Bing really fails to deliver. I have a hard time calling it better than Google and a really really hard time seeing it being better enough to switch. It just doesn't do that much more. If they're doing search, then the clearly need to do it better right? Not simply as good. Is it just arroagance that they can deliver some that merely matches or approaches Google and expect to eventually win? What makes them think that? It doesn't appear to be supported by any facts.
- chakde 15y ago
  Personally I don't think there's any doubt that Google's search quality has fallen down over the last few years. There have been a few instances where what I was looking for was not found on Google and I gave up looking for it. Later (after a few months!) when by chance I tried the same query on Bing, the results showed up right on the first page. Surprised by this, I rechecked it on Google and it appears either on the 3rd or 4th page - something I would never check earlier. Since then I started always doing a backup search on Bing for anything important, to see results I might have missed on Google. By now, I'm using them 50:50. Also attended a lecture on Bing search, and learnt that their approach is a little different, which could acount for this observation.

makecheck 15y ago

Please retain original article titles as per the guidelines [1]. In this case, the new title is also inaccurate. This article is actually called "Microsoft's plan to stop Bing's $1 billion bleeding", and the loss on Bing alone is $5.5 billion since mid-2009. It was only Microsoft's total online services division losses that reached $9 billion, and that was since 2007. [1] http://ycombinator.com/newsguidelines.html http://ycombinator.com/newsguidelines.html

puredemo 15y ago
I wonder what else is in the online services division?
- 0x12 15y ago
  MSN, messenger.
  - stumm 15y ago
    I think messenger is part of windows live, which I've been told falls under the windows umbrella.
- deleted 15y ago
  [deleted]
- jeroen 15y ago
  From http://careers.microsoft.com/careers/en/es/onlineservices.aspx http://careers.microsoft.com/careers/en/es/onlineservices.as... : Bing, MSN, MS Advertising, Global Foundation Service (the infrastructure)

ramchip 15y ago

"Bing will likely be better than Google over time, but even if it is, users and advertisers still need to go to them," said Sid Parakh, analyst at McAdams Wright Ragen. "To be clear, this will take a long, long time to play out. This is something Microsoft will continue to lose money on." That's an example of an annoying tendency that I see in many news sources. Why is a vague quote from an investment advisor relevant here? Who is Sid Parakh and what justifies his opinion? I see nothing related to search on his linkedin profile, at least.

brown9-2 15y ago
Even more, why does Sid Parakh believe that Bing will "likely" be better over time? He doesn't even qualify his own statements.
- jaredmck 15y ago
  It seems unlikely that bing will be better over time, since google has more data and will continue amassing more click-through data with which to improve the results.
keepsearching 15y ago
Because McAdams Wright Ragen paid a PR firm to get mentioned on CNN. Now Sid is what's known as a "source".

dave_sullivan 15y ago

Sounds like bing probably represents better bang for your advertising buck than google at this point. Could be good deals there for marketers. For microsoft's part, it just seems like they're always one step behind google, which is one step behind Facebook, which sooner or later will be one step behind someone else when they've maxed their revenue from their current business and feel compelled to stray from their core competencies. History repeats itself and the young grow old. Also, thought it was an interesting bit about bing gaining marketshare from yahoo (their partner) and not google. Ouch.

danmaz74 15y ago
It could be a big bang for the buck, but you're limited to only 15% of the users...
dasil003 15y ago
I don't like this idea of companies being one step behind. I mean, yes, Bing is one step behind Google (in some regards anyway). And Google+ is one step (or a dozen) behind Facebook. But it's not like the new hotness invalidates existing business models. Where things are most interesting is where companies compete by embracing their own values (eg. Android vs iOS). I know Microsoft is famous for copying others' innovations, and back in the 90s they did it quite effectively, but for a lot of companies it feels like grasping at straws during their decline. I'd rather see companies focus on their strengths. You never hear people talking about how Amazon is "one step behind" all the newer sexier companies, and they're still on the bleeding edge.
- dave_sullivan 15y ago
  It's not so much that the new hotness invalidates existing business models--I don't think it does--it's more that wildly successful business models will suffer from the law of decreasing returns sooner or later and this causes companies to go into areas they wouldn't normally if investors were not so focused on continued hyper growth and the new new thing. So if I'm reading you right, I think we agree on the point, if not the analogy :-)

danmaz74 15y ago

The examples of "semantic search" reported in the article don't look innovative at all to me. Giving you specialized results (eg maps) based on the search query has been done for ages, and expanding on that can be useful but it will hardly be revolutionary. Moreover, trying to guess the semantics of user's queries can be very annoying to some users, especially the geekier ones which are often also the trend setters in this area - there are lots of people already being pissed off by google when they search for synonyms of what you type, and not exactly what you type. Competition is always good and I hope that Bing and Google will make search always better, but I'm not so sure how useful will be what was reported in this article.

mturmon 15y ago
The article is thin on the use cases of semantic search, which is the market Bing says it's trying to serve ("a decision support tool"). The article raises the question of "how will Bing make money" and then drops the question, and goes on to talk about competing with Google. Lazy thinking by the writer.

mattmanser 15y ago

One wonders why with an apparent 15% share they're losing so much? Also find it interesting that they're gaining share, while the article states it's from other providers but Google, doesn't that still mean that these users are actually choosing Bing over Google? That they're chosen it because it's better?

brown9-2 15y ago
They are losing money because they are pouring money into buying that 15% with advertising, deals with mobile carriers, etc. The division also has thousands of employees. Bing is not like a small but scrappy startup who can make a profit off their small market share because they are lean.

bane 15y ago

The sad thing is that they are spending this on a fight that's largely been over for a few years. Hell, the social fight is nearing a conclusion were it not for g+, MS is not just trailing in the Internet space, they are in a time machine.

alttag 15y ago

I suspect part of Google's success is not just front-page search but also site-specific searches (how some sites use Google as a a back-end search). Perhaps more significant is their number of AdSense affiliates. (After all, search doesn't make money, advertising does.) Blog after blog and developer and developer continue to embed Google ads, and are thus themselves bound to Google and encouraging others to do so.

bergie 15y ago

From last year: When you hear the word “startup”, you most likely think of an Internet startup. Maybe it’s funded, maybe not, but its burn rate almost for sure puts it in the red each quarter. Obviously, Microsoft is not a startup. Nor have they been a startup for a long time. But what if you thought of their Online Division as an Internet startup? One funded by Microsoft. The thought it terrifying. Or it should be. To Microsoft. Microsoft released their Q1 2011 earnings today. The results were very good except for one very big blemish: the Online Division. Last quarter, the division lost $560 million for Microsoft. That’s better than the previous quarter when it lost a staggering $696 million, but it’s much worse than a year ago, when it lost $477 million. In the past year, Microsoft has lost well over $2 billion from the division. http://techcrunch.com/2010/10/28/microsoft-online-business/ http://techcrunch.com/2010/10/28/microsoft-online-business/

olliesaunders 15y ago

I get that Bing is no success, but how is it losing so much money? That can’t just be developer salaries can it?

icebraining 15y ago
Marketing.
dillona 15y ago
Advertising I'd imagine

pnathan 15y ago

Well, Bing always feels slow and 'baroque' in visual looks. Google always is fast and has a very clean visual look. Duckduckgo is slow and has a clean visual look (and doesn't track me). I use DDG. :-)

joelthelion 15y ago

As much as I'm happy to see Microsoft losing money, this is actually very bad news. Any competition for Google is a good thing, and at this rate it won't be long before Microsoft cuts expenses on Bing...

brudgers 15y ago

Another half assed analysis of Microsoft's Online Services Division. OSD includes Bing, MSN, Live Mail and Messenger...aka support services they provide to their internal and external customers (e.g. Windows Phone 7 uses Live Mail). It doesn't include profit centers like Xbox Live or their various enterprise level cloud services. OSD is primarily a cost center for marketing. Microsoft attributes half the value of its goodwill to OSD (US $6B). [http://www.microsoft.com/investor/EarningsAndFinancials/Earnings/FinancialStatements/FY11/Q1/IRFinancialStatementsPopups.aspx?tag=msft:GoodwillDisclosureTextBlock&title=Goodwill http://www.microsoft.com/investor/EarningsAndFinancials/Earn...] In addition, it's revenues don't reflect any savings Microsoft realizes by advertising it's own products on it's own ad network or by promoting its own brands on MSN (e.g. stories from MSNBC). Finally, the value of the data collected by the OSD is not directly reflected as revenue. That data provides Microsoft with insight regarding search, shopping, social networks, news interests, etc.

kooshball 15y ago
All Windows Live properties are in the "Windows and Windows Live" division under Sinofsky. Not in OSD. http://en.wikipedia.org/wiki/Microsoft#Windows_.26_Windows_Live_Division.2C_Server_and_Tools.2C_Online_Services_Division http://en.wikipedia.org/wiki/Microsoft#Windows_.26_Windows_L...

kablamo 15y ago

Thats a lot of money. Is duckduckgo profitable yet? I bet its not losing $1 billion per quarter. But then again I suppose Bing has hugely more market share than duckduckgo.

chrismealy 15y ago

A couple of years ago they'd lost something like $8 to $10 billion on xbox too.

forkandwait 15y ago

Why I don't use Bing: 1. I hate the stupid pictures and the other stupid fluff. 2. It is called "Bing" (the only worse brand name is "Yaris"... what are they thinking?) 3. Microsoft doesn't help fund and staff a LOT of the Free software infrastructue I depend on.

IanDrake 15y ago
>It is called "Bing" I've always wondered about names...is Bing only a bad name because they haven't been successful? Is Google only a good name because they've been incredibly successful? I wonder how many people said the same thing about Google 12 years ago?
- gamble 15y ago
  I still see Google as a silly name, but at least it has some rationale in the corporate philosophy and a hint of geek cred. "Bing" just smacks of a committee of corporate drones trying to look hip with an unintentional parody of younger, cooler Web 2.0 company names.

JoshTriplett 15y ago

Providing the same services as Google will not get people to switch from Google, even if Bing provided somewhat better results. Google got people to switch because they didn't just provide astonishingly better results, they did things quite differently than others. If Bing wanted people to switch, they have to do something different, not just do the same things "better". Bing can't win by offering "a better way to Google": http://www.youtube.com/watch?v=tYVCk10AzS0 http://www.youtube.com/watch?v=tYVCk10AzS0

Aloisius 15y ago

The one thing you can say for Microsoft is that they stick to their guns and keep trying. With Google, you never know if a product has a team behind it or it was someone's side project that got out of hand and received too much press that they'll kill a couple in a couple months because it didn't get enough traction. Now sure, in the startup world the idea of sticking with an idea and plotting along losing money is a terrible sign, but on a personal level I can't help admiring Microsoft's fierce tenacity.

iamelgringo 15y ago

In certain verticals, Bing really outshines Google like travel search, video search, and image search. Bing maps is really quite good. Microsoft is a cash cow, and has multiple sources of strong revenue. Google has one: advertising. Microsoft can afford to bleed cash for years, just to give Google a black eye. Microsoft only this past year got out from under government oversight for antitrust violations. I've spent quite a bit of time talking to people at Microsoft the past 2 years. A lot of the BizSpark team are ex-Sun people. And a number of them have mentioned to me how shocked they were at how profoundly the anti trust litigation still affected employees within the company 10 years later. Windows 8 is the first OS since ME that comes out without government anti trust oversight, and it looks like Microsoft has come out swinging, both at Apple and Google. http://channel9.msdn.com/Events/BUILD/BUILD2011/KEY-0001 http://channel9.msdn.com/Events/BUILD/BUILD2011/KEY-0001 Google is just now starting to get into anti trust how water, and I have no idea how they are going to get out of it. I think Yelp in particular has a really strong case: http://www.pcworld.com/article/240330/google_faces_antitrust_accusers_expedia_nextag_and_yelp_wednesday.html http://www.pcworld.com/article/240330/google_faces_antitrust...

wavephorm 15y ago
Microsoft can afford to bleed cash for years Except that's exactly what they've been doing for a long time now. Microsoft reminds me of a cliche fat cat executive who's always red in the face, yells and bosses everyone around, and acts like he's invincible... until he keels over from a heart attack.
- barista 15y ago
  Except that for pretty much every year it has been in business the revenue and the profits have been growing.
  - wavephorm 15y ago
    Sure the company as a whole is profitable. But if their internet businesses were it's own company, and run in this manner, they wouldn't survive. They're sure good at keeping up an appearance of extreme arrogance.

bstar77 15y ago

I think that I have a similar problem to many other users... It's not that Bing is a bad product, it may be the best thing out there. The problem is that I've lost confidence in Microsoft as a company to objectively serve me information. It's a trust issues that I don't have with Google or Apple... yet. Those companies have their warts too, but nothing like I experienced in the 20+ years I was locked into the MS ecosystem. As long as a guy like Steve Ballmer is running the company, I will stay far away. Perhaps when management changes down the road result in MS better demonstrating that they are more interested in producing great products rather than gaining market share at any cost, I'll take them seriously again. We're starting to see some of that with windows mobile and win8.