It’s not just that Microsoft is losing money online, it’s that they’re bleeding it. And it’s getting worse, not better. The company has lost $9 billion online since they started breaking out the numbers in 2007 — $2.5 billion of that was in the past year.
And Bing has accounted for $5.5 billion of the total losses.
And what is Microsoft spending all that money on? Stealing market share from Yahoo, not Google. Yahoo is their search partner. Google is their enemy.
So what is Microsoft’s plan to make money on Bing? Essentially: get more people to use it.
Why didn’t anyone else think of that?
Microsoft’s real problem here is that in order to beat Google in search, they can’t just be better — they have to be exponentially better to get people to switch. And I’m just not sure that’s possible.
Microsoft is fighting a battle they’ve already lost simply by not taking it seriously earlier.
Billions in loses later, Microsoft may be starting to understand this. They have to compete with Google by not competing with them. They have to do something totally different and something Google can’t possibly copy.
Only one possibility comes to mind: Facebook.
They’ve been doing stuff with Facebook already thanks to their small investment in the social network. But they need to completely blow it out. Facebook search sucks. But it won’t suck forever. Eventually, they’ll do it themselves. And they’ll do it in a way that will compete with Google by being completely different. It will not be Bing.
Microsoft needs to hurry.