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Microsoft Pledges Search Innovation

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REDMOND, WASH. Admitting it badly trails Google in the search marketplace, Microsoft vowed to advertisers it would quickly catch up with more relevant search results and new user options.

Christopher Payne, vp of MSN Search and Windows Live Search, told attendees at MSN's Strategic Account Summit here that while Google dominates the market today, search is still in its infancy with much room for advances in the years ahead.

"I'd like not to be in the No.3 space," he said, referring to MSN's spot below Google and Yahoo in search use. "I think the key to not being No. 3 is innovation."

Payne said MSN is now about equal to Google in terms of search relevance, which will enable it to build advances in personalization and local results that will differentiate it enough to draw more use. MSN Search, for example, now provides over 2 million direct answers to search queries through Encarta. It is also increasing its use of satellite and roadside imagery for local search. "There's no information that shouldn't be available in this system," he said.

Microsoft is dramatically ramping up spending on developing search technology, according to company executives at the company's earnings report last week.

For now, MSN continues to lose search market share, according to research firms.

It has about 13 percent of the search market, compared to 45 percent for Google and 28 percent for Yahoo. Its declining share of search advertising was pointed to by executives as a major reason MSN's ad growth, about 7 percent, badly lags the overall market and is dwarfed by Google's.

Advertisers are rooting for Microsoft to improve its search offering to better balance the market, said Ellen Siminoff, CEO of Efficient Frontier, a San Francisco search-marketing firm. "Marketers will be patient with them because marketers want them to be successful," she said.

Microsoft's search efforts got a boost this week when Amazon switched from Google to Microsoft as the search provider for its A9 and Alexa properties.

"I truly believe if we build a better search software solution we'll gain market share," Payne said.