Filed under: Products and services, Launches, Consumer experience, Competitive strategy, Google (GOOG), Microsoft (MSFT), Yahoo! (YHOO), eBay (EBAY), Marketing and advertising

Microsoft Corp. (NASDAQ: MSFT) shares dropped 1.77%. OK, you can state it was just as much as the Nasdaq dropped, or you can also state that no one was really impressed with the software giant’s new cashback on search service.

It is no secret Microsoft is trying to boost its internet division and gain search market share. After so often being accused of being a monopoly, I guess it’s hard for it to see Google Inc. (NASDAQ: GOOG) now being accused of the same in the lucrative business of internet search. Well, Microsoft tried to acquire Yahoo! Inc. (NASDAQ: YHOO), No. 2 in search (although it is also losing market share to Google) but we all know that didn’t work out all that well… at least not yet. I get the feeling we haven’t heard the last on that subject yet.

To address its search insufficiencies, Microsoft Wednesday rolled out Live Search Cashback, a new service that pays consumers who buy selected items from participating retailers found through Microsoft’s Live Search engine. Only a portion of the purchase price, of course, between 2-30% will be paid — via check, direct deposit to a bank account or eBay Inc. (NASDAQ: EBAY)’s PayPal. So naturally, those wishing to use the service will need to sign up and provide Large Brother with even more personal information.

No one can tell me this doesn’t smack of desperation. Is Microsoft really serious in thinking this could actually make a dent in its search business? The cash rebate might attract some people, but that doesn’t mean they’re going to change their search habits. If anything, they might still search on Google, then go to the Live engine and find what they want there. The rest of time, I bet, Live won’t be in use! Of course, the higher the cashback, the more people it will attract, but doesn’t that sound a tiny backward? How much can Microsoft spend on that? And couldn’t Google at any time counter with a similar offer should it select to?

I’m sorry, but this just doesn’t sound care about it would change anything in the reality of search today.

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This entry was posted on Wednesday, May 21st, 2008 at 5:22 pm and is filed under Companies Competitive Strategy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.