How Microsoft can Obliterate Google

Time Bray has it right. In the future, every site can carry search. All Microsoft has to do is to give the revenues from any potential search to the site carrying it. Two big assumptions:

  • MSN Search has to be as good as Google search (not there yet, but possible)
  • Microsoft is willing to forego the Google ad revenue stream in exchange for severely crippling Google. Right now, it seems like MS wants the revenue stream rather than to eliminate it, but that seems unlikely.

4 thoughts on “How Microsoft can Obliterate Google

  1. actually, the other way to beat Google is via Pay-Per-[trans]Action. altho eBay, Amazon, and Yahoo have better opportunities than Microsoft, since they currently control the point of sale transaction.consider that PPC-based advertising beat the pants off CPM-based advertising by providing better ROI and more performance-based value for the advertiser’s dollar. why pay for impressions when you can just pay for qualified leads?similarly, PPA-based advertising should beat the pants off PPC-based advertising. why pay for qualified leads when you could just pay for actual sales?furthermore, there are likely some merchants / advertisers out there who could afford to pay *more* for the advertising if they were guaranteed to have a sale. currently, Google (& Yahoo Overture) force the merchant to do all the conversion math themselves, and determine how much PPC traffic they will pay for in order to generate sales — but without blowing their margin.a PPA-based system would open up the market to both 1) new advertisers who aren’t clueful enough to pay for PPC-based traffic, and 2) fatter margins where those advertisers would be able to pay more for advertising, if they can count on an actual sale.why eBay and Amazon haven’t already woken up to this is beyond me. i’ve had a conversation with several eBay execs and they haven’t been able to respond with any good reason other than risk tolerance. until Google controls point of transaction, this is a huge area of vulnerability to their business that eBay, Amazon, and Yahoo could take advantage of (basically, anyone with storefront presence / paymemt functionality).someone’s sure as hell missing out on a boatload of money here… wait too long, and the Googlers will figure out how to get there first.- dave mcclure

  2. Dave,Interesting point. CPA is an important part of the ad market that is underserved, and folks like Quinnstreet and Adteractive are making lots of money doing a manual conversion of CPC to CPA.However, in fairness, CPC is also a compromise between publishers and advertisers. With CPM, publishers can cheat easily. With CPA, advertisers can cheat, unless, as you point out, the owners of the payment system verify the transaction. In that sense, the best positioned entities to build a CPA ad network are Visa and Mastercard…

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