January 26, 2007
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When it comes to Microsoft’s struggling internet business, Microsoft CFO Chris Liddell is beginning to sound like a broken record. This is what he said today of yet another poor quarter’s results from the online services division:
We’re clearly not happy with that. We continue to take a long-term view of the business and to invest in it.
More than a year after turning on AdCenter, its challenger to the Google and Yahoo! search advertising systems, the best Microsoft can do is scrape together a 5 per cent growth in internet revenues in the latest quarter. Profits have evaporated, turning into a $155m loss.
Mr Liddell promises that Microsoft will finally get its search monetisation engine working by the end of this year: revenue per search by then will be back to where it was a year ago, he says. But Microsoft’s share of the search business continues to dwindle, and at $624m its revenues from the internet in the latest quarter were only 8 per cent higher than four years before. In "Google time", that amounts to an aeon of lost opportunity. By the time it’s ready to fight with Google toe-to-toe, will it already be too late?
