Bing's real return: A catalyst to a Yahoo deal

Bing's real return: A catalyst to a Yahoo deal

Summary: Microsoft's Monday launch of its Bing search engine has generated a fair amount of hubbub, but the real return may go beyond mere market share.

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Microsoft's Monday launch of its Bing search engine has generated a fair amount of hubbub, but the real return may go beyond mere market share. 

The return calculation behind Bing goes something like this:

  • Undisclosed cost of research and development (something Microsoft would spend anyway);
  • The salary of Qi Lu, Yahoo's former search guru, to head up Microsoft's search engine;
  • $80 million to $100 million on Bing marketing;
  • A nice hedge against Yahoo (Bing will most likely take share on Yahoo);
  • Savings from Microsoft forgoing a Yahoo deal completely or at least reducing the price tag. Yahoo CEO Carol Bartz wants a boatload of money. If Microsoft can downgrade that boat to a rowboat Bing has more than paid for itself. 

If any of those latter two items play out Bing will have justified its existence.

Also see: Microsoft Bing: Quick, clean, handy or a present day "Dogpile"

It's far too early to see how this plays out. For instance, it's unclear whether Bing can hold its first day pop. However, I have come back to it a few times. Frankly, that ability to attract return users---even if Google remains the default choice---may be all Microsoft needs to justify a return.

More reading: Microsoft's Bing: Powerset's role, market share, brand (and other burning questions)

Topics: Browser, Enterprise Software, Microsoft, Social Enterprise

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  • Good one

    Bing is a successful product.
    Gladiatorcn