Last year’s merger between Yahoo! and Microsoft’s search business, has had unforeseen consequences on the overall search and advertising market.
In the middle of 2009 Yahoo! and Microsoft had a market share of 19.5% and 8.5% of the US search market respectively.
Rather than the merger consolidating and improving their market share in search, today’s numbers of a total market share of just 20% show that the merger has been a negative for the partners and extremely positive for Google, whose market share now stands at 75% in the USA.
Disappointing financial results continue to plague Microsoft as its operating system and Office software sales have shown no signs of a much-promised ‘take off’ post the Credit Crunch.
Meanwhile, Google continues to threaten Microsoft’s core business with the success of its Wave platform and the whole notion of web browser-based (rather than operating system-based) applications.
Investment website 24/7 Wall Street estimates that Google could destroy 20-30% of Microsoft’s core business in the next 24 months.
Already investors appear to be discounting Microsoft’s future troubles as the stock closed down on a strong ‘sell’ recommendation yesterday.
It is not all good news for Google. Anti-trust actions in the US, China and EU are starting again – and this time the target is not Microsoft, but Google.
Welcome to the price of unbridled success.
