I'm afraid you're moving the goal posts a bit. When I was at Microsoft I saw a lot of presentations about how the advertising industry was much bigger than the software industry, and how MS needed to tap into that growth opportunity in a big way. I saw very few presentations about how a modest search market share would keep infrastructure costs lower.

I believe you are mis-characterizing my position somewhat - I stated that lower infrastructure costs are a benefit of smaller scale but I did not state that they were the sole measure of success.

While I don't doubt that powerpoints about quick easy money from advertising were legion in Redmond, it doesn't change my belief that Bing has been a significant success for Microsoft despite the money being neither quick nor easy. The notion of measuring the success of the Bing team against the whole of Google is silly. Bing's success should be measured solely by the business benefits it provides to Microsoft.

"I stated that lower infrastructure costs are a benefit of smaller scale"

I find this statement confusing. Perhaps in terms of absolute numbers, infrastructure costs are less at smaller scale, but as a percentage of revenue, larger scale usually shows increased infrastructure leverage, until you get to Microsoft/Google/Facebook size, and start designing your own Servers, Power Supplies, Storage, etc...

It's completely reasonable to compare companies against each other to determine their success - particularly when being the leader gives you network-effect benefits.

Measuring costs with actual dollars rather than percentage signs is often the best way to judge the bottom line. Yes, relative infrastructure cost tend to go down at a larger scale - assuming that revenues increase in proportion to the infrastructure added, which may not necessarily be the case with Bing and advertising.

It is also important to acknowledge the opportunity costs for Microsoft that scaling Bing might entail, e.g. is infrastructure more profitably used for cloud services or search? Does an advertising revenue model interfere with the necessary trust which underpins Microsoft's business relationships with enterprise customers?

I am not saying it is unreasonable to compare Microsoft with Google at the corporate level - but using Bing and Google Search as the primary criterion for such a comparison is a category mistake.

This was not the goal. Recall that they tried to buy Yahoo and merge into a solid competitor agains Google. I'm sure there are many smart people still left at MS, but not as many as you make it sound.

So Bing is now entirely some sort of anti-trust hedge that doesn't need to succeed on its own? That is one impressive twist of thought.

I'm not following you. I imagine that the Bing team would gladly increase their market share in exchange for the costs involved.

Not necessarily, "Bing : Microsoft" is not analogous to "Google Search : Google." Bing just needs to fill a small gap in Microsoft's total product portfolio whereas Google Search is the crown jewels for Google. In other words, Bing can be a cost center for Microsoft and still contribute to the company's bottom line by contributing to increased revenues in other areas, but if Google Search starts losing money Google is in real trouble.

So long a Bing provides meaningful statistical data regarding internet search,keeps Google from data mining searches performed in Redmond, and serves as a productive R&D platform it is successful for Microsoft because they do not need to generate significant revenue from advertising to be profitable.

Of course more market share is good. But Microsoft is not purely interested in growing share with Bing; non-differentiation with Google is a good thing in and of itself. The less differentiated Microsoft is from Google, the greater perception of their platform having feature parity with Google. That way consumers are not forced to choose based on features, just ecosystem.

This is a the reason that Microsoft is a fast copier of market leaders, so that everything consumers could want, on paper, is housed within their roof (and Google's). It seems counterintuitive that less differentiation would be useful, but I think it's what Microsoft is going for.

Microsoft used to be able to "embrace and extend" in order to extinguish the competitor. With Bing it seems they can only "embrace", by which I mean copying and trying to decrease differentiation. But look at the trend. In the future, when/if Google search incorporates social feedback effects (ala +1), Bing won't even have the user-base to be able to copy the competitor, let alone extend and extinguish.

One look at my website statistics tells me Bing is already as good as dead.

Yeah, except Bing gets to mine Facebook and Google doesn't. Maybe that's why it has a higher success rate?

http://www.bing.com/community/site_blogs/b/search/archive/20...

http://www.stateofsearch.com/bing-gaining-share-in-the-us-su...

I'm not completely convinced that Bing lacks the user base to compete with Google. There are diminishing returns in user base volume after some point, and Bing has around 100mm US users[1]. I think any of us would be pleased as punch with that volume and it's not clear it's not enough to do something-social-with-search.

[1] http://blog.compete.com/2011/03/16/february-2011-search-mark...