14 DAY TRIAL // Microsoft is still spending a fortune on making Bing a powerful rival for Google, but it appears that the Redmond-based technology giant is wasting lots of money on a continuously declining division.
A report by Business Insider reveals that Microsoft’s Online Services Division, which also includes Bing and MSN, is recording huge losses every year, but the parent company doesn’t seem to care.
Last year alone, this particular unit posted a loss of $262 million (€204 million), even though Microsoft has invested a lot in an attempt to give Bing a chance in the fight against Google in the search engine war.
Long-time statistics are even more shocking. Since the first quarter of 2005, Microsoft’s online unit has lost no less than $10.9 billion (€8.5 billion), again after the company has invested millions in advertising campaigns and programs designed to stir up interest in its products.
Bing is the core of the Online Services Division, with Microsoft claiming that most Google users who decide to give this search engine a try actually like its features.
Statistics provided by market researcher comScore prove otherwise. Google still had a 66.5 percent market share in April, while Microsoft’s services have barely reached 17.3 percent.
And still, CEO Steve Ballmer might have found the cure. Ballmer will soon announce a major restructuring plan that would integrate Bing and some other products into a larger unit simply called “services” and supposed to help the Redmond-based empire migrate towards the devices and services approach the big honcho talks about all the time.
This way, Microsoft could easily cover up the overall losses of its online services, even though the company is very likely to continue spending big on advertising campaigns. Steve Ballmer is expected to announce the reshuffle plan as soon as this week, so more information on this will be provided shortly.