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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.
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.
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.
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Weiner views the MSN search switchover as the beginning of Microsofts longer-term bet on search as a fundamental technology across its products. Where the company can grab more search market share is by attracting search users through its other products, such as other MSN services and Microsofts Office software.
“They realize their competitive advantage,” Weiner said. “Put search in the inbox, in Hotmail and [instant messaging]. Put search in as many places that have your name on them as possible.”
MSN also has discussed upcoming search offerings that could differentiate it from its competitors, Sullivan said. For example, MSN is planning to offer a blog search service called MSN Blogbot. MSN officials initially pegged that for release by the end of 2004, but Blogbot has yet to go live.
MSN Search also has begun experimenting with RSS features, letting users of its beta create RSS feeds for search queries.
Along with its potential ties into other products, search also could help MSN become a player in the search-based advertising market, analysts say.
Sullivan expects MSN to eventually stop using Yahoos paid-search division, Overture Services, for sponsored listings on its search site and to develop its own paid-search offerings. But such a move appears to be more than a year away since MSN signed a deal to use Overture listings through June 2006.
MSN officials have not disclosed any plans to build its own sponsored-listings technology.
The biggest impact from MSNs search entry may be in perception. Little more than a year ago, search users and even the Web site operators vying for top search rankings viewed Web search as being synonymous with Google.
While Google remains dominant, more and more people are realizing that search options exist. Microsofts moves and potential marketing effort around MSN Search will only intensify the growing competition among the search engines, said Tim Kauffold, director of business development at search-engine marketing company Oneupweb, in Suttons Bay, Mich.
“Googles lock on the share is starting to a slide a little bit,” Kauffold said “Its good for all three of them, and it keeps them motivated to improve at all times.”