Microsoft enters the Internet search market – at last

By | November 10, 2004

After years of licensing search technology from Yahoo and seeing its Web search market share slowly but steadily decline, Microsoft has finally developed its own search engine and is expected to unveil it later this week.

The current situation at the search market does not look too encouraging for Microsoft – with the market share of about 14% it is far beyond the two major rivals – Google with almost 50% and Yahoo with 24%. Both companies, especially Google, have long developed a very good technology and successfully established highly loyal bases of users.

As it is hard to believe that Microsoft’s search engine will be much better than those of its competitors in foreseeable future, the company’s success in stopping the decline and regaining the market share will depend on its ability to leverage other – numerous and significant – competitive advantages it has.

Microsoft is apparently seeking to take advantage of its practically unchallenged dominance at the PC operating system market once again as it did a decade ago with Internet Explorer. This rather mediocre piece of software by itself gained huge market share after becoming integral part of mighty Windows suite.

While Microsoft is trying to penetrate the Web search market, Google is extending its reach to touch Microsoft’s core territory. With Google Desktop announced last month the direction has become clear – Google wants to dominate not only the Web search but also desktop and LAN search.

Microsoft will probably strike back with an integrated version of its desktop and Internet search engines. Until this has happened Microsoft should not expect too much from its new product.

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