Microsoft's Bing Overtakes Yahoo in August Searches

Microsoft's Bing outpaced Yahoo to take second place in the U.S. search market for August, even as the companies began their search partnership. Google remains the undisputed search king with 65 percent of the market. An analyst said Yahoo's fall should be a wake-up call to bring on the user-experience innovations the company promised.
While the tech world continues exploring Google Instant search from every possible angle, Bing is betting on a bright future -- and making progress in the search-engine wars. Microsoft's decision engine has officially clenched the number-two position in the United States. Now only Google stands in its way.

Of course, few believe Bing will outpace Google, which remains the undisputed search king with 65 percent of the market in August. That's up slightly from 64.2 percent in July, according to Nielsen. Bing now boasts 13.9 percent of the U.S. search market, up from 13.6 percent in July. Yahoo has dipped from 14.6 percent to 13.1 percent. Ask is in fourth place with 2.1 percent, and AOL comes in fifth with two percent.

"comScore and Hitwise still show Yahoo as number two, but Bing's trajectory suggests that it could overtake Yahoo at some point in the near future," said Greg Sterling, principal analyst at Sterling Market Intelligence. "However, comScore showed Yahoo share growth in July. This should be a wake-up call to Yahoo to step up the pace of user-experience innovation that the company promised when it announced the Microsoft deal."

The 10-Year Run

Although Yahoo has lost, the pain isn't as acute as it might be if the Internet giant wasn't in cahoots with Bing. Together, Yahoo and Bing have secured nearly 30 percent of the market. That's still less than half Google's market share, but Microsoft and Yahoo plan to keep the full-court press on their common nemesis.

"Microsoft and Yahoo announced a search deal in July 2009 where Microsoft would start powering Yahoo search while Yahoo became the exclusive worldwide relationship sales force for both companies' premium search advertisers," Nielsen wrote in a blog post. "Microsoft Bing officially started powering part of Yahoo searches on Aug. 24, 2010. If we combined Bing-powered search in August pro forma, it would represent a 26 percent share of search."

Under terms of the deal, Microsoft got an exclusive 10-year license to Yahoo's core search technologies and can integrate them into its existing web search platform.

Bing Power

Assuming Yahoo searches was the first major move in the deal Microsoft and Yahoo inked after the companies failed to merge. Forged just 14 months ago, the 10-year search partnership will see Microsoft's Bing powering Yahoo search, and Yahoo will be the sales arm for premium search advertisers.

No major moves on the advertising front have been announced. As the agreement continues to roll out, advertisers will see self-serve advertising for both companies fulfilled by Microsoft's AdCenter platform, and prices for all search ads will continue to be set by AdCenter's automated auction process. Each company will maintain its own display-advertising business and sales force.

The Yahoo web, image and video searches on both desktops and mobile Relevant Products/Services devices will be powered by the Microsoft platform. That means the results consumers get on Yahoo and Bing should be identical.

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