You can virtually hear it: Bing! Bing Bing! As ridiculous as the name of Microsoft's (Nasdaq: MSFT) search engine sounded, it does exactly what Microsoft wanted it to do: Gain market share. Nielsen said that Bing has a U.S. market share of 13.9% in August, up from 13.6% in July. The gain was enough to surpass Yahoo!, which dropped from 14.3% to 13.1% share in the U.S.

Google (Nasdaq: GOOG) still dominates the search ranking with a 65.1% share, up from 64.2% in July. Microsoft began running Yahoo!'s search engine with Bing technology on August 24. The combined market share is now at 27.0%.

It is remarkable that Bing is affecting Yahoo!'s market share much more than Google's share. While Google has remained stable over the past year and was listed with a 64.6% share in August 2009, Yahoo! has dropped almost 3 points from 16.0% share last year. Microsoft gained more than 3 points from 10.7% to 13.9% in the same time frame.

It will be interesting to see how Google's Instant Search will be affecting search market search in the coming months. Nielsen said that it only reports on search queries generated by a user, which means that contextual searches or hovers or in-text searches are not reported. There was no information how instant searches will be reported.

More than a year ago, I had the pleasure to listen to Microsoft chief executive officer Steve Ballmer when he gave a speech at the Executives Club of Chicago. He was very modest when he described the opportunity of Bing against Google, but called Bing his "little engine that could" when noting that it is "working hard" on its 8% market share. When asked about his biggest mistake, he mentioned that, if he could turn back time, he would start sooner on search.

In a slightly optimistic tone and obvious pride about Bing, he said that Microsoft had its "mojo back." It appears that he was right on this one after all.

Ctech

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