Microsoft Tries To 'Fix' Markets That Aren't Broken

In a campaign that begins this week in the U.K., Microsoft is reprising the 'Bing And Decide' marketing campaign it trotted out last year in the U.S. after it launched Bing. In televised ads, Microsoft claims that today's engines aren't accurate enough and subject their users to "information overload." Bing, naturally, is presented as the solution to this problem.

This line of reasoning is also seen in Microsoft's stance on Windows Phone 7. On Monday at the Jeffries Technology Conference, Mindy Mount, CFO of Microsoft's Entertainment and Devices Division, said the Windows Phone 7 user interface was designed to stand out from the pack of competing mobile devices, which, she suggested, are increasingly becoming indistinguishable from one another.

"If you sit back and you look at the smart phones out in the world today, you'll notice that they're all starting to look alike. It's a sea of sameness," Mount said at the event.

Microsoft may say the search market is suffering from inefficiency, but according to Comscore's January search market data, Google had 65.4 percent market share compared to 17 percent for Yahoo and 11.3 percent for Bing. Microsoft's search deal with Yahoo will help, but the reality is that Google apparently works well enough for the majority of people who use it.

Microsoft is spending large sums on differentiating Bing from Google, and the Bing Maps demo the company showed off last week during Steve Ballmer's cloud computing positioning speech is one area where this investment is bearing fruit. Still, it could be years before Bing starts turning a profit, and at some point investors may get impatient and start asking whether Microsoft's pursuit of the search "white whale" is in their best interests.

Besides, the search market is one in which first mover advantage has proven to provide lasting advantages. Earlier this month at the Search Marketing Expo West in Santa Clara, Calif., Microsoft CEO Steve Ballmer admitted as much. "The truth of the matter is the number one thing that Google benefits from in search is they did it right first," Ballmer said at the event.

Microsoft is well acquainted with the benefits that first mover advantage can convey, but in the mobile space, its once dominant position has been steadily eroding ever since the iPhone and other mobile devices with vastly superior user experiences began arriving on the market. According to Comscore's December 2009 figures, Microsoft accounted for just 19 percent of the smartphone market, compared to 42.6 percent for RIM and 24.1 percent for Apple.

Are mobile device user interfaces really a "sea of sameness"? The iPhone is still selling like hotcakes, propelling Apple to record revenue in recent quarters and prompting COO Tim Cook to start referring to Apple as "a mobile device company." Android and Symbian devices are both doing pretty well despite ostensibly being part of this sameness.

Mount has a point about smartphone UIs being similar, but that hasn't stopped people -- including a growing tide of businesses -- from craving the iPhone and other non-Windows Mobile devices. Until Windows Phone 7 devices arrive later this year, "sameness" is actually the best description for what's been going on in Windows Mobile.

Microsoft is a proud company and it's none too pleased with where it finds itself in mobiles and in search, which is why it's talking about changing market landscapes instead of just gaining points of market share in "baby steps" fashion. But while Microsoft certainly has the deep pockets to market its notions into beliefs, right now its mobile and search marketing sounds like wishful thinking.