How Microsoft Could Topple Google

For all its recent woes, there's no doubt that Microsoft (Nasdaq: MSFT) employs some of the world's smartest people. Give these same people $6.6 billion in R&D money, as Mr. Softy has, and they just might figure out how to reshape an entire industry.

According to News.com, this week Microsoft researchers are presenting papers at a scientific conference in Seattle, outlining new ways to account for the user experience in increasing the relevancy of search. For example, one paper describes how measuring the amount of time a user "dwells" on a page she's clicked through to can lead to better results.

Another paper suggests incorporating user data to improve search algorithms. I'll understand if that sounds eerie, but programmers have long worked to allow computers to remember certain tasks and tendencies in aiding the user experience. Adding that same capability to search isn't a great leap.

Surely Google (Nasdaq: GOOG) is also working on major enhancements to its search platform, and they'll undoubtedly be extremely useful when they arrive. Nevertheless, Microsoft's innovations demonstrate just how small the margin of error is for the search king.

Think about it. How many times has Google given you exactly what you wanted on the first try? Probably a few, but that's hardly typical. More often, you'll conduct search after search after search until you finally get what you want. To be fair, that's exactly how it works with Microsoft's MSN, as well as Yahoo! (Nasdaq: YHOO) and every other search engine out there.

But it also illustrates a key truism: Search technology is remarkably flawed, and desperately in need of massive innovation. Microsoft's active efforts to create such technology, and build it into its Internet Explorer browser -- which commands 83% of the Web browser market, according to analytics firm OneStat -- should worry Google-watchers preparing to pay 55 times earnings for the Next Big Thing.

Search for further Foolishness:

• Same Stocks, More Profit
• Microsoft Goes 3-D
• Google Flashes Its Cash

Microsoft is a Motley Fool Inside Value selection. Ask us for anall-access passto the service, and you'll be privy to chief advisor Philip Durell's best picks, which collectively are beating the market by nearly 2%. Give Inside Value a try; it's free for 30 days.

Fool contributor Tim Beyers loves using Google, but is too chicken to invest in the shares. He prefers cheaper merchandise. Get a peek at all the stocks Tim has invested in by checking his Fool profile. The Motley Fool has an ironclad disclosure policy.