Microsoft is used to leading in markets in which it operates. The company has the most popular operating system in the world with Windows for PCs and has the most popular productivity suite around with Office. The company, however, is far from leading in some categories though like search and mobile phone operating systems.
Microsoft is looking to grow its share of the search market in the U.S. and abroad with a new advertising campaign designed to let users know that the search engine is redesigned and works better than the old MSN search. The most notable thing that Microsoft is doing to grow its share of the search market in the U.S. is to get Yahoo to use Bing for its search results. The long publicized deal between the two search giants was finally given the nod by the U.S. DOJ in February 2010 clearing the way for the Bing results to show up on the Yahoo site in the second half of 2010.
In addition to working with Yahoo for search, Microsoft is also looking to oust Google from its perch in other search segments like mobile. Microsoft and Apple are reportedly in talks to see Bing replace Google as the default iPhone search provider.
Research firm comScore has revealed its latest numbers for the search market this week and has found that Bing has grown at the expensive of Yahoo search. Bing was able to grow its share of the U.S. search market from 11.3% in January to 11.5% in February. During that same period, Yahoo saw its share of the search market slip from 17% in January to 16.8% in February. Google is still the clear and decisive leader in the U.S. search market with a whopping 65.5% of the U.S. market for February, which was up slightly from January's 65.4% market share.
Jefferies & Co analyst Youssef Squali wrote in a research note, "While the share losses have been exacerbated by the ongoing roll-over of tool bar partnerships (with HP and Adobe), we continue to believe that it is critical for Yahoo to stabilize its market share in 2010 to remain relevant in the search market."
EWeek reports that Yahoo is not expected to reverse its declining trend considering that Bing will replace Yahoo for search results in the coming months. Once Bing replaces Yahoo search results, the combined market share for Yahoo/Bing will be 28.3% looking at today's numbers. That still puts Bing at less than half of Google's reach.
Squali attributes the growth of Bing to the marketing campaigns Microsoft is running and the Bing Cashback program. Analysts from FBR Capital Markets see the reasons for Bing's growth differently attributing the growth to trending of search queries on MSN in addition to the ad campaigns.