Bing has cost Microsoft $5.5 billion since 2009

By on September 21, 2011, 11:30 AM

Despite making some gains in market share, Bing, Microsoft's two-year old search engine is losing nearly a $1 billion a quarter and shows no sign of letting up. This according to a CNN Money article, which estimates the company has lost nearly $5.5 billion on the endeavor since its launch in 2009.

The article points out that Bing has gained a 14.7% share of the search market since then but these gains are not coming at Google's expense. According to online data tracker comScore, Google currently commands 64.8% of the market, down from the 65% it held when Bing debuted. More than half the share that Bing has gained has actually come from its deal to power Yahoo searches, while the rest has come from smaller partners and players like Ask or AOL.

Microsoft has had no issues in the past with entering a market late and spending a lot of money to push its way into a strong position. It failed with the Zune but was very successful with the Xbox 360 and hopes to repeat that with Windows Phone. With Google practically untouchable in the search market they have their work cut out for them, though.

Microsoft President of Online Services Qi Lu said the company could not and would not try to "out-Google" Google. Instead, it must "change the game fundamentally." The belief is that if Bing can change the way people think about search, focusing on things like natural language and questions, sooner or later users will switch over from Google.

To this end the company is putting a lot of emphasis on social and mobile, though its Facebook partnership and Windows Phone, while offering more granular search in verticals by marring Bing with many of its own products. Microsoft hopes this will help it gain a semantic understanding of the web and seems willing to keep burning money on the effort. Of course, even if they can steal market share from Google, there's still a long road toward profitability.




User Comments: 22

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TomSEA TomSEA, TechSpot Chancellor, said:

I don't understand how you can "lose" 1 billion dollars per quarter hosting a search engine. I know you have to have the infrastructure in place as well as employee's managing the site. But 99% of the coding has been done. At this point it's basically just hardware and software maintenance.

I don't get it......

slh28 slh28, TechSpot Paladin, said:

I don't understand how you can "lose" 1 billion dollars per quarter hosting a search engine. I know you have to have the infrastructure in place as well as employee's managing the site. But 99% of the coding has been done. At this point it's basically just hardware and software maintenance.

I don't get it......

Advertising and employee costs probably

chandra70007 said:

Bing may me less popular than Google but once I was searching for a particular software application, then Google has given me an N number of results where only few matched my requirements. As I couldn't get what I wanted I just told myself why not try Bing. Well to my surprise it displayed all the companies which provide this software. As per my experience I think the search is precise in Bing where as in Google you get tons of results which I have to wade through.

Guest said:

So they want natural language questions? I don't. Why would I type

"What is the capital of Finland"

in Bing when I can type

"Finland capital"

or

"What is the episode of south park focused on Mr Garrison but not the one with Kathy lee in it"

when I can type

"South park Mr garrison -Kathy -lee"

Not the best examples, but the whole reason Google is top dog here is because of the concise nature of the searches.

Guest said:

They are loosing 1 billion per quarter because they are paying people to use it, so they can show people they are gaining market share. Never use it, never will.

Tgard said:

I use Bing and will keep using it at least as long as they are paying/rewarding me to use it and maybe beyond. It's not too bad. It did take a bit to get used to, but I have gotten used to it. Bing Images are nice, I have used their maps and directions, and my searches all seem to bring up sites relevant to what I searched for. Haven't used Google in forever. Used Yahoo before switching to Bing when they offered the reward deal.

amstech amstech, TechSpot Enthusiast, said:

People don't want pre-determined results.

Google is a superior search engine, we like open results.

If people want to learn how to use keywords better, that is up to them.

Bing is for people who aren't good at searching, just like Macs are good for people who aren't good with computers.

Guest said:

@amstech: You paint with a wide brush. We all can choose what things work best for us and it doesn't mean someone is smart, dumb, right, wrong, etc. just that choice A works for them while choice B works for someone else.

Enjoy using Google and I'll enjoy using Bing.

:)

Guest said:

The reason is quite simple:

- "Dude, just google it."

- "Dude, just bing it."

:-S

SammyJames said:

sammyjames said:

Who uses Bing?

I rest my case.

Guest said:

There's not much difference between Bing and Google. I choose not to use Google as I a not a fan of Google persistent data collection. I mean they all collect data, but Google a little bit too much for my taste.

cliffordcooley cliffordcooley, TechSpot Paladin, said:

Maybe I would understand this better if I knew exactly how they could make money with a search engine. They speak of loss but not profits, are they making anything at all?

I can't imagine why expenses are so high to begin with. Seriously, where would that kind of money be going?

gwailo247, TechSpot Chancellor, said:

sammyjames said:

sammyjames said:

Who uses Bing?

I rest my case.

It's like watching Golum talk to Smeagol.

Guest said:

"just like Macs are good for people who aren't good with computers."

Funny, that's what they said about Windows users who moved from MS-DOS.

Judging by how well Apple is doing it seems more likely that Macs are good for people who like computers to do what they're supposed to.... WORK. ;)

Bing is a great search engine. So is Google. Choice is good for this industry.

As for the billion dollar a quarter loss, I'd love to see how they came up with that figure.

Guest said:

@ TomSEA

Bing can gain market share by improving it's search results, which won't be a game changer since Google is improving it's search results at the same time.

Bing can try and attract advertisers with lucrative deals, but this again won't be sufficient alone, since Google has higher ROI and isn't sitting idle with it's advertising platform.

Bing can attempt to tie-in with it's PC, Phone, and Tablet offerings. Again, Google is right there with it's own tie-ins.

The only way Bing can win: stay relevant until one of it's sister properties gives it a competitive edge that Google's stronger market position and tie-ins can't out maneuver. Part of that involves R&D spending on things we haven't heard of yet, that might be tied to Bing's payroll but are being executed by another group within MS. And MS 'ate' the costs of launching the XBox platform before it started making money with XBox 360, so it very well might be that Bing is expected to be a cost-center that keeps MS relevant in Search while it develops the successor that will really take on Google (as a whole, not just search).

Guest said:

I miss Bing cashback!

Guest said:

1 million+ search results? who goes past the first page anyway?

Archean Archean, TechSpot Paladin, said:

chandra70007 said:

Bing may me less popular than Google but once I was searching for a particular software application, then Google has given me an N number of results where only few matched my requirements. As I couldn't get what I wanted I just told myself why not try Bing. Well to my surprise it displayed all the companies which provide this software. As per my experience I think the search is precise in Bing where as in Google you get tons of results which I have to wade through.

Fair point, and exactly the reason I ditched google, because sometime Google won't find what is needed and I wasn't interested in scrolling endless pages for what I am searching for, since I switched from Google I never needed to look beyond top 5 searches for what I am looking for. But in general, both engines turn out similar results, one may excel in one area and the other in some other. So it all comes down to habit nothing more.

fpsgamerJR62 said:

I actually like using Bing because sometimes Google just can't locate the website or information that I'm looking for. Besides, having a choice of search engines is always a good thing for everyone using the internet.

aj_the_kidd said:

Considering my searches on google have been consistently very good, i see no reason to move to Bing

Guest said:

duckduckgo.com does not track you and gives me what I need most of the time, and if it fails I can always use google as a backup.

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