Business - Written by on Monday, March 19, 2007 8:54 - 0 Comments

Denis Hancock
Web search – it pays to use Microsoft

Can a search engine buy its way to success? We are about to find out, as Microsoft is not only offering their Live Search feature to companies for free, they are also offering a $25 K enrollment credit, and $2 – $10 for each computer using it annually. Any way you add it up, that’s a fairly nice chunk of change.

So are they doing the same for the consumer market? Kind of. But instead of paying people directly, Microsoft is enticing them to test the Live Search on a number of “click for cause” websites. In turn, each search leads to a small donation being made to education programs for refugee kids around the globe. Even for the most committed Microsoft haters out there, it’s hard to put a negative spin on this.

But that’s not to say it isn’t a very calculated business move. One would imagine a focus group or two could tell you that offering people $2 – $10 annually to search on your site isn’t going to win over many people. The opportunity to join millions of others in helping the most vulnerable people in the world? Lets hope most people would be interested in that.

Interesting times in the search world. Google’s turned their free service into gobs of advertising revenue, Jimmy Wales is trying to wiki the space, and now Microsoft is talking about actually paying people to use their service. Is it possible that someday marginal revenue that can be accrued from offering search will be driven down to (or below) the marginal costs associated with it? And if so, what are the implications for Google’s $134 B market cap?



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