Microsoft Extends Yahoo Revenue Guarantee

Microsoft's search engine competitor to Google, Bing, has been around for a few years now and has made some headway into the search market, although the market for both organic search and search engine marketing remains dominated by Google on both sides of the pond.

For the average consumer, the difference between the search engines is not clear.  However, we would have thought that Microsoft CEO Steve Ballmer would have a good grip on the advantages of Bing, but his comments at this week's Web 2.0 Summit in San Francisco would suggest not.

When asked on stage about the search engine, Ballmer encouraged the audience to try it out, because, apparently, 70% of the time there will not be any differences between the results from Google and Bing, 15% of the time Google will be better and 15% of the time Bing will be.  As far as we can see, he indicated that Google fans should stick with Google, as it will deliver results at least as good as Bing on average - hardly a great endorsement.  

Also made public this week was Microsoft's extension of their revenue guarantees to Yahoo; when they signed their search deal, Microsoft promised to make up any revenue shortfall to Yahoo, a promise that has now been extended from March 2012 to March 2013.  An indication that revenues are not taking off as hoped? Yahoo blames Microsoft technology for the problems, but with no real clarity on the problems or promises of an imminent solution, Microsoft seemed resigned to throwing money at the problem for a while yet.