Live Cashback Not Giving Search Back
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News Analysis. Microsoft's latest effort to raise search share is a failure. |
On Friday, Dec. 29, ComScore released November U.S. search share numbers, which I started to blog about then. But the flu beat me back. I had even completed the chart below.
Microsoft has clearly sunk into the high search share single digits, and it's going nowhere but down. I predict technology historians will record that Microsoft CEO Steve Ballmer made a major tactical mistake by not buying YouTube for about $500 million when he had the chance. Google's later $1.6 billion YouTube acquisition proved surprisingly insightful, from revenue and search share perspectives. The revenue's not there today, but there is search boost. In November, about one-quarter of total Google site searches came from YouTube.
Meanwhile, Microsoft seeks to buy search share through programs like Live Search Cashback. What's that saying? Money can't buy love? Apparently, Microsoft can't pay people enough to use Live Search. November should have been a big month for Live SearchCashback, which collapsed on Black Friday under the traffic load of a big Hewlett-Packard promotion. Holiday buying should mean lots of Live Search Cashback searches. If Microsoft did get them in November, then its search plight is even worse than ComScore's numbers show. But I suspect it's more a situation of no benefit as indicated by Google share gains, which remain consistent, but modest.
Perhaps December will be better for Live Search Cashback. There's still a chance holiday buying will help lift those search share numbers. But if not, then Cashback must be called a failure because:
- Microsoft didn't get the search share gains.
- The company has to pay out to Cashback searchers and buyers in a weak economy; yeah, let's add more debt to Online Services' balance sheet, shall we?
Matters can only get worse for Microsoft. Google sees the effectiveness of Microsoft bundling strategies. So Google has primed its Google Chrome browser for rumored OEM deals. Google can bundle, too. Chrome's recent change to v1 is foreshadowing. Think, people! Google doesn't take the beta moniker off anythingnot quickly anyway. But, whoa, Chrome is good enough after only 100 days of testing. Now why is that?
My prediction: The rumors about Google snoggling OEMs are true. Your next laptop or netbook could have a Google-branded browser with bundled Google search as default. If I had any computer animation skills, I would make the point by doing a little movie of a Google "G" made over as Pac-Man. Gobble, gobble, gobbling search share.
Microsoft's new Online Services Business chief, Qi Lu, has inherited a mess. Does this former Yahoo executive really understand the waste-deep pile of poop he has stepped in? Qi Lu will be a convenient fall guy, as a Microsoft outsider, should he fail to raise Microsoft search and advertising share. The prospects are as bleak as Seattle weather, which this week is snow. That's unfair. What's bleak about a white Christmas?
ComScore's November numbers tell the story. While the number of overall U.S. searches, 12.3 billion, declined 3 percent sequentially, Google continued its search share gains, up 0.4 percent. By the numbers:
- Google: 7.8 billion
- Yahoo: 2.5 billion
- Microsoft Sites: 1 billion
Microsoft search share held steady in October but resumed its decline in November, when holiday sales through Live Cashback should have given back search share. Nope.
Circling back to where I started: YouTube. ComScore's top-line numbers somewhat obscure just how successful YouTube is. In ComScore's expanded search view, which adds subsites or services to core search, Americans conducted 18 billion search queries in November. Google's expanded category search share, which includes YouTube, would be about 59.6 percent. Among the 22 expanded sites tracked by ComScore, all declined but four (Google was unchanged): Amazon.com (up 14 percent), eBay (up 1 percent), other Microsoft sites (up 4 percent) and YouTube (up 8 percent). By comparison, some declines: Ask.com (down 10 percent), Facebook (down 12 percent) and Windows Live (down 7 percent).
YouTube had 2.79 billion search queries in November, according to ComScore. Two startling statistics:
- If ComScore ranked YouTube as a search engine, the video sharing site would be No. 2, ahead of Yahoo.
- In the expanded search view, YouTube accounted for about one-quarter of Google search share.
YouTube's popularity cannot be understated. The number of searches and viewers is astounding. Americans viewed 13.5 billion online videos in October, a 45 percent year-over-year increase, according to ComScore. In terms of video properties, Google's share was 39.7 percent compared with second-ranked Fox Interactive Media at 3.8 percent. But video viewership is something else. There were 147 million unique U.S. video viewers in October, roughly 100 million to Google. That's right. Google video viewer share topped 68 percent. By comparison, second-ranked Fox had 60.7 million viewers, but smaller number of videos per person. The average number of videos viewed per person was 8.6 at Fox versus 53.5.
The point of all this: Microsoft is shoveling Live Search Cashback bucks into a fire pit. Microsoft should have bought YouTube when it had the chance. YouTube is about to become Google's crown jewel for search and advertising revenue (outside the main service). The latter is more the work in progress. But it's coming along fast.
By the way, sometimes timeliness is overrated. This post would have been much less if done on Friday, when the flu still had me down.
[Please send your tips or rumors to watchtips at live.com]


Comments (18)
Joe says:
"Matters can only get worse for Microsoft. Google sees the effectiveness of Microsoft bundling strategies. So Google has primed Chrome for rumored OEM deals. Think, people! Google doesn't take the beta moniker off anything—not quickly anyway. But, whoa, Chrome is good enough after only 100 days of testing. Now why is that?"..................
As far as "matters can only get worse for microsoft," I totally agree with that statement. And Joe, as a microsoft watcher, you must see the parallels to ancient Rome and microsoft. Also, as far as it gettings worse for microsoft, that is not necessary a bad thing for computer users in general, in fact, I would say that it is the best thing possible.
About 3 years ago, microsoft was in almost total control, at their height of desktop penetration with 95.3%, and like Rome, since the advent of Vista, microsoft has started on the long road to its decline and fall. Why I am not worried about Goolge is they are simply better in almost, or every way than microsoft.
Posted by The Hand | December 22, 2008 2:49 PM
Merry Christmas to all and a Happy New Year!
Posted by Marco | December 22, 2008 3:06 PM
Thanks Marco!
You too!
Posted by The Hand | December 22, 2008 3:12 PM
@Marco
Let me really wish you a Merry Xmas, as it seems someone has already done so in my name. Since they can't post under their own name, must be they have no ideas of their own.
Posted by The Hand | December 22, 2008 3:25 PM
Joe, can you please stop mentioning that you have/had the flu in every post?? WE GET IT.
crappy health = crappy blog posts
this post was just fine, no need to bring up your health plights.
Thanks! =)
Posted by Dan | December 22, 2008 4:16 PM
Thanks The Hand (True and false)...it's christmas!
Posted by Marco | December 22, 2008 5:15 PM
We should all get together and invent a totally new browser and call it the
Solstice Taco Jupiter Browser.
Merry Christmas to all and sundry.
Posted by KitKat | December 22, 2008 8:36 PM
Solstice Taco Jupiter Browser.
I think they would have a chance only if they promise not to keep your personal data past the date that marks the end of the Mayan Calendar!
(oct 23 20011?)
Posted by Dcsos | December 22, 2008 11:06 PM
Joe,
"On Friday, Dec. 29, ComScore released November U.S. search share numbers,"
What year are you talking about? 2007 Dec 29 is on Sat.
Did you mean Dec 19?
Posted by ysrinu | December 23, 2008 1:10 AM
So what's the point I'm missing then?
First of all I am still under the assumption that search is only a good thing because of advertising revenue.
If you want a product searching for it will help you buy it. So in that case search advertising is good.
If you are looking for something and run into something that really interests you, you might buy it. Again search advertising is good.
If you want to watch an online movie how will search advertising help you? Seeing you will not be able to watch any of the movies you would want to buy, nor would you be able to buy the movies you are watching.
So it's just search for search's sake.
How is that a good thing?
Posted by Charlie | December 23, 2008 2:15 AM
I think some of the people on the search team need to watch the same internal training videos that have been inflicted on me. There was one which used a very nice phrase: "No pain; no change." If people aren't experiencing any pain in their current situation, they're not going to try and change it.
Live search is a great search engine, but the majority of people are happy with Google. People aren't likely to suddenly decide to switch search providers for no reason so they aren't likely to even try out Live to see if they like it.
That sounds somewhat defeatist. I do think Live search is good, but I'm realistic about the odds of half the internet users suddenly going, "Hang on, what's this Live search thing no one ever talks about?"
Posted by Jess Meats | December 23, 2008 3:18 AM
'That sounds somewhat defeatist'
Only if you are MS'worker or MS'Fan ,if you are pragmatic it just sound real.
--------
Hi Jess
Humm... Jess Meats... What a beautiful and seductive name!
Posted by Marco | December 23, 2008 10:11 AM
@Jess
So basically Microsoft's saviour in this matter would be Google's downfall. Which is probably only going to happen if they "do evil"...
Plus I've given live search a shot... and it took me longer to find the results I wanted than with google. Except for images. No pages, just images makes a hell of a lot more sense to me.
So not only do they need people Google to be bad in some manner, they need to get better themselves too.
Posted by Charlie | December 23, 2008 10:59 AM
Apple has proven that a company can significantly increase its market share against tremendous odds. Moreover, M$' search engine will continue to play catch up so long as they don't advertise it. For example, I believe most non-IT people would say that live maps is superior to google maps. And something like mapping could easily drive many more searches, but again, M$ has to let Joe Consumer know about their alternative.
Posted by Jay | December 23, 2008 5:57 PM
"I believe most non-IT people would say that live maps is superior to google maps."
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I wouldnt. If we are talking maps, its more likely that google maps IS THE ONE that non-it users know. Ive yet to find a non-it person that can tell me what MSlive is.
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Jay, Im sorry to say this, but I am suspicious of your posts. Please let me explain.
You use the term "M$" for Microsoft, which is something people will identify with those who do not support MS. People who use M$ generally go on to put MS in a bad light. You however go on to praise MS. I could be forgiven for thinking the use of M$ is to convince people that you are NOT a MS supporter, but have good things to say about them. Like I say, that is my interpretation.
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Your posts also have the other warning signals, not explanation as to why they are better and no explanation of these mythical "non-it" people who think live maps are better.
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Truth is, Google Maps are being used by both non-it and it pros alike. Truth is no matter what other products are out there, Google maps appears to be satisfying its users by providing the information and facilities they require.
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I should never have stayed away for a couple of days. I turn my back for 5 minutes and all the outlandish claims come crawling out of the woodwork.
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Ill end on a little cracker of a comment "M$ has to let Joe Consumer know about their alternative."
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Jay, care to comment on what went wrong with Zune then?
How about xbox360?
What about Vista?
Do we need to go on?
Posted by Goblin | December 24, 2008 6:30 PM
LIES!
Posted by steveballmer | December 26, 2008 6:03 PM
Joe says:
Analysis. Microsoft's latest effort to raise search share is a failure.................
Really??? Say it ain't so Bill. But then when you use it, and get the discount at M$ participating retailers, you then find out, that google would have found you several links that would have saved you even more money, without clicking though near as many links too. Why, because M$ search is a poor product, and this was designed to make money, as everything M$ does, by selling people overpriced products.
Posted by The Hand | December 27, 2008 6:58 PM
@Goblin
"what went wrong with Zune then? Howabout xbox360?"
This is pretty off-topic, but... When Zune launched, the iPod had around 75% mp3 player market share. Zune has about 5% of mp3 player market share today, and the iPod still has around 75%. Zune was only sold in the US until it recently started selling in Canada. Microsoft is saying that it will probably start selling in Europe this fall. It's a good mp3 player (not necessarily the best) and they haven't given up. Besides, would you ask what went wrong with MacOS X? It's still only got about 5% of desktop computer OS market share to Microsoft's roughly 90%. Apple will keep fighting for OS market share, just like Microsoft will keep fighting for mp3 player market share. I like MacOS way better than Windows, but Apple computers are way more expensive than PCs. The point is, products that have their niche aren't going to go away despite their small sliver of market share. And when it comes to search, no slice of the pie is too small. Microsoft will keep fighting to increase it.
Regarding Xbox360, what are you talking about? It's been nothing but good news for Microsoft this year. It became profitable and increased its market share putting it well past the PS3. Only the Wii is ahead of it, but the average Xbox360 purchaser buys two more games than the average Wii purchaser, resulting in hundreds of millions more in revenue for Microsoft on game sales and Xbox Live subscriptions.
Vista... nothing much to say, there. It's had a pretty rough time. ;)
@The Hand
"But then when you use it, and get the discount at M$ participating retailers, you then find out, that Google would have found you several links that would have saved you even more money... because M$ search is a poor product, and this was designed to make money, as everything M$ does, by selling people overpriced products."
Really? I find that the cashback search produced comparable results to the Google product search, but for some things, like anything on EBay, it was better to use the cashback search. After all, if you're going to buy something on EBay anyway, you might as well get cash back for it by finding it through the Microsoft cashback search.
I think the biggest problem with Microsoft Live Search is that they don't have anything like adWords/adCents. Google has thousands of websites automatically doing searches every time the pages load and populate those "Ads by Google" bars. So, one, they get a higher search count and two, they get more revenue from web surfers clicking on those ads. This has got to be on the top of Microsoft's to-do list for search. If they offer webmasters the ability to place Live Search ads on their site and pay them more money (a higher percentage of the $ per click perhaps) than Google pays, I could see the possibility of Microsoft gaining search share.
Posted by Hans Grobin | January 5, 2009 8:34 PM