Are you ready for your close-up now, Microsoft (NASDAQ:MSFT)? The company officially launched its Windows Live search engine this week at Live.com. Unlike the eye candy-cluttered portal you'll find at Microsoft's own MSN.com or Time Warner's (NYSE:TWX) AOL.com, Windows Live is a Google (NASDAQ:GOOG) disciple when it comes to minimalist landing pages.
Live.com is all about searching through the Internet, scouring through news stories, and tracking down images. There's also a QnA feature, trying to cash in on the popular community-driven Yahoo! (NASDAQ:YHOO) feature, Yahoo! Answers.
As the distant bronze medallist in a race that never ends, one would think that Microsoft doesn't stand a chance to lap Yahoo! and Google by simply aping its rivals. Thankfully, Live has a few standout features.
Imagine all the images
The image search interface is superb, with an intuitive feature that resizes the thumbnail images on the fly depending on how many graphics you want on a single page. Navigating through the thumbnails is enhanced by the welcome mouseover effect of having the graphic that your mouse pointer is over enlarged just enough to stand out.
The load times on the thumbnails could be a bit quicker, but it's a small quibble for an offering that truly improves on what the market giants have going on in that realm. After kicking the tires of Live.com, it's the one aspect of Live that would win me over, even though I'm not much of a digital snapshot collector.
Live's scratchpad feature is also nice, as a way for users to drag interesting search results and lump them all into a single space.
Unfortunately, that's about it for Live in its present form. The Internet and local searches, in their present form, won't be losing Yahoo! or Google any sleep for now. In the old days, Microsoft didn't have to be better. Just as McDonald's (NYSE:MCD) doesn't put out the best burgers, few will argue that Internet Explorer is the best Web browser or that Windows Media Player is the best multimedia streamer.
Because Microsoft owned the desktop space through its operating system stranglehold, it became the horse pill tube capable of jamming just about anything it wanted down the computing public's throat.
But the rules are changing these days, as companies like Google and Yahoo! are carving out bigger chunks of your monitor space through innovations like toolbars and desktop search functionality. Even if Live factors greatly into the upcoming Windows Vista platform, it won't be the lay-up it used to be now that a pair of big search giants are guarding the basket.
In short, any successes that Microsoft will have in the future will clearly have to be earned.
Innovation isn't always enough
One of the coolest search engine features was introduced by IAC/InterActive's (NASDAQ:IACI) Ask.com earlier this year. After giving Jeeves the boot, the site went for a makeover. The new site is anchored by the ability to see thumbnails of search result landing pages from the actual result page. It's a feature so slick that it has become the basis of a nationally televised ad campaign for the site.
So, have all of the improvements and marketing initiatives paid off for Ask? Not exactly. According to comScore, Ask's market share was 5.4% of all searches in July. That's essentially where it was a year ago.
So, it won't be easy for Microsoft to carve itself a much thicker slice than the 12.8% of the search market it presently owns. It has every reason to want more, as it has been gradually rolling off the tarp from its adCenter text ad platform. In Google, it can see a company with a $120 billion market cap, riding mostly on the fact that online advertising accounts for 99% of its revenue mix. Unfortunately, everyone has their eyes on the prize. Even worse, the gradual blips in monthly market share data show that consumers are pretty loyal to their search engine of choice.
I don't see Live.com or adCenter as the catalysts to achieve more than that bronze medal around its neck. That doesn't mean that there's anything wrong with third place at a lucrative feast in a niche where there's plenty to go around and advertisers are only going to come in harder over the next few years.
Good luck with Live.com, Microsoft. I just hope you're not banking on a miracle.
Microsoft is a Motley Fool Inside Value recommendation, and Time Warner is a Motley Fool Stock Advisor pick.
Longtime Fool contributor Rick Munarriz hates to see good companies duke it out, even when he has ringside seats. He does not own shares in any of the companies mentioned in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. T he Fool has a disclosure policy.
