A good month for Microsoft

During February the ongoing Microsoft and Yahoo! ‘Search Alliance’ was given the official go-ahead by both the European Union and the US Department of Justice. Microsoft will now acquire the Internet search and search advertising businesses of Yahoo! under a 10-year exclusive license and, soon after this announcement, the company launched its new Internet smartphone product onto the market.

Firstly, the Search Alliance between Microsoft and Yahoo! has now got the green light to develop new and better search services to try to take on the market dominance of Google. Under the terms of the agreement, Microsoft will manage the technology platforms that deliver the algorithmic search results (powered by Bing) and also the paid search results, which will be powered by adCenter. Eventually all of Yahoo!’s PPC search services will be managed through the better adCenter system and probably not before time!

Yahoo! and Microsoft will each provide customer support to different advertiser segments, with Yahoo!’s sales team exclusively supporting high volume advertisers, SEO and SEM agencies, and resellers and their clients. Microsoft will support self-service advertisers. The full impact of these changes are likely to be seen by the last quarter of the year.

When Microsoft and Yahoo first agreed to combine their search services in July 2009, the market share of Google went down to 88.95% while that of “Microhoo” went up to 9.12%. This was very encouraging for the executives at Microsoft and Yahoo!, but the real question is whether this combined force can make a bigger impact into Google’s current level of usage and market share. There’s no definitive answer to that, but in order to compete with and surpass Google at its own game “Microhoo” has to innovate constantly and learn from the changing search dynamics.

Meanwhile, Microsoft continues to enhance its mobile technology and attempts to defy critics who say that its days are numbered in the rapidly growing smart phone market. On 15th February Microsoft launched its ambitious new mobile platform that is a major departure from its existing Windows Mobile offering. The new platform effectively scraps Windows Mobile 6.x with a completely revamped user interface and more tightly defined integration with devices and network.

Analysts say that the new Windows Phone 7 Series as a radical departure for Microsoft in terms of user-interface design, while also bringing something different to the mobile market. The company wants to compete against the iPhone, and similar products from Google Android and Samsung, but they are taking quite a radical move away from these products in the hope to gain significant share of this market.

The introduction of the new Windows Phone 7 Series won’t happen until the end of the year, and many have wondered whether Microsoft could become a factor in the mobile marketplace amid its declining market share. Observers said they were surprised and impressed by the progress Microsoft has made, but it remains to be seen to what level Microsoft will succeed. For this to happen they will have to prove that it’s stable, works very well and delivers on the partner integration Microsoft have promised.

If you would like more information about how the Microsoft and Yahoo! Search Alliance can help the marketing of your business please contact us.

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