Redmond isn't done for, though, and soon will be unveiling their new Kumo search engine, which has recently gone under internal testing. While nothing has been formally announced yet, rumors indicate that Kumo will be launched in just about a month.
Some details have been leaked regarding what the new service will offer, such as expanded searches that pull up relevant information about a search, as opposed to just sites containing the queried terms. With a huge ad campaign ready to launch and a new search engine ready to roll, Microsoft will try to take both Yahoo and Google's spots. Will they be able to do either? Perhaps Yahoo, but when it comes to innovation, I think Google is still a step ahead of Microsoft in the web services department.