Microsoft Ready to Prove Its Search Stuff

After a year of promises and rising expectations, Microsoft Corp. appears ready to jump headlong into the search-engine market.

But dont expect the entry of Microsofts MSN division into Web search to immediately shift the balance of power in the search industry, say search-engine analysts.

While the search results MSN has previewed so far are competitive to those from rivals Google Inc. and Yahoo Inc., MSN still must prove that it can compete in emerging search areas such as local and video search and find ways to capture more search market share, analysts say.

Microsofts MSN division has made clear over the past year that it intends to replace the Yahoo search results on its main MSN Search site with those from its own search-engine technology. MSN officials decline to pinpoint a switchover date, saying it will occur early this year.

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Across search-focused Internet message boards and Weblogs, search-engine marketers are saying that MSN is likely to cut over to its technology as early as Tuesday.

Signs do point to an imminent launch of MSNs full search engine. MSN in early January began ramping up its search-engine beta test that began in November by diverting more visitors from its main search site to the beta search engine.

"When you do searches there you do get good results, and I suspect that nobody will notice they changed," said Danny Sullivan, editor of Search Engine Watch. "They are competitive."

MSNs move comes a year after Yahoo made a similar search bet. Yahoo in February 2004 dumped Googles search results and replaced them with its own technology. While Yahoo gained widespread attention, that switchover had little immediate impact on Yahoos search market share, Sullivan said.

Yahoo has become Googles biggest competitor. According to November figures from comScore Networks Inc., Google holds a 34.4 percent share of U.S. Web searches, while Yahoo holds a 31.8 percent share. MSN is in third with a 16.5 percent share.

MSN may have surprises in store when it officially launches its search engine. Yet based on the plans discussed so far, Sullivan said that he expects MSN to continue to be playing catch-up with Google and Yahoo.

Thats because MSN is launching core Web search technology for finding information from billions of Web pages at a time when Google and Yahoo are entering new vertical search arenas such as geographically targeted results and multimedia search.

MSN, so far, does not offer a separate local search site or multimedia engine, though its search beta does offer the ability to search for local information within its main index.

"[MSN] is going to need to move more quickly to build the verticals that theyre lacking," Sullivan said.

Read more here about the growing options in multimedia search.

The worlds largest software maker does have advantages over its rivals with its foothold on the desktop with Windows and productivity software, said Allen Weiner, a research director at Gartner Inc. The search launch demonstrates Microsofts ability to corral the resources necessary to tackle a new market.

"Its a pretty big move, and it sets the tone for what theyre going to be doing moving forward," Weiner said. "Theyre going to look inside for innovation."

Next page: Competitive advantage.