During its first two years in market,
Bing lost $5.5 billion, but that’s not everything. Looking in
Microsoft’s older financial records reveals that the company’s online
services division has been losing money since day one and it has never
made any net profits till now.
Microsoft’s
online services division has incurred total losses of $9 billion since
the company started releasing its financial records in 2007.
Microsoft
argues that those losses are required temporarily to establish a
foothold in the online search market that has been dominated by Google
for too long now. The company noted that it has been gaining market
share against Google steadily over the last 27 months.
Microsoft’s
argument is technically correct as Bing now maintains a 14.7% of the
online search market, up from the 8.4% it owned at launch. But it is
important to note that this market share was not taken from Google which
maintains a market share of 64.8% now, only 0.2% down from the 65% it
owned when Bing launched.
Almost half of
Bing’s customers are Yahoo users who use it indirectly since Yahoo is
now powered by Bing. The rest of the customers came majorly from Ask.com
and AOL deserters.
