Microsoft Unveils AdCenter, Shows Vision for Future Advertising
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At the seventh annual MSN Strategic Account Summit, Microsoft showed off its new adCenter and its vision of the future of online advertising. Should Google and Yahoo be worried? Should you start taking Microsoft's search engine seriously?
“Now that we have all of this access to content on the Internet, I want to encourage all of you to be very careful about when you allow people to record you on videotape. You never know when it's going to come back and haunt you anymore.” Steve Ballmer, starting his address at the seventh annual MSN Strategic Account Summit earlier this month, struck a light but cautionary note. Perhaps he was thinking about a similar address he made two years ago, when he admitted that his company had made a mistake when it failed to develop its own search engine. Though this summit saw the company pushing some new products and its vision for the future of search and advertising, the message went out to a skeptical crowd.
The crowd had good reason to be skeptical. Even Microsoft Chairman Bill Gates admitted the company was not exactly where it wanted to be currently. "For Microsoft, we always want to be in the lead, making the breakthroughs," Gates said, and conceded that rival Google has “done a great job on search and what they’ve done with advertising.” He could hardly admit otherwise; even Microsoft’s famous FUD campaigns can’t completely disguise the facts.
The percentages tell the story: both ComScore Media Matrix and Nielsen/NetRatings show Microsoft’s search engine slipping in the battle for mind share with the other two major search engines. ComScore shows Microsoft’s share of U.S. searches slipping more than three percent in a year, while Google gained more than six percent in the same period. Nielsen/NetRatings shows a smaller drop, but starting from a lower percentage. The figures most quoted in the press show Google fielding nearly half of the search queries made, while Microsoft’s search engine handles a mere 11 percent.
Against these numbers, Microsoft faced a real challenge at this year’s summit. It needed to convince advertisers to sign on to its AdCenter. But it also needed to reassure its investors. The company’s stock has taken a beating in the last couple of weeks, which is not exactly a good backdrop for a high-tech pep rally. What was Microsoft’s message in the face of this?
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