Ballmer: We'll beat Google ... someday

The search leader's main advantage is that it "got it right first," he said.

It's not easy being Steve Ballmer. The Microsoft CEO was asked for the umpteenth time Tuesday if his company will ever be number one in search.

"There's no good answer to this question. If you say yes you seem like you're arrogant and if you say no it looks like you have no faith. So the answer is yes, someday," Ballmer said.

"The truth is, the number one thing Google benefits from is they did it right first," he said.

Ballmer was interviewed on stage Tuesday at the Search Marketing Expo in Santa Clara, California, by Danny Sullivan, editor in chief of Search Engine Land and a longtime search industry watcher.

A cornerstone of Microsoft efforts is a search and advertising deal with Yahoo, in which Microsoft Bing will become the search engine for Yahoo's Web sites, with Microsoft taking a share of revenue, and Yahoo will handle search ad sales for both companies' largest advertising customers.

The deal is about increasing Microsoft's search volume, which helps it to fine-tune its search engine to give better results, and about bringing more eyeballs for advertisers, Ballmer said.

He was asked if Yahoo will survive as a search company as Microsoft tries to "climb over it" on the way to the top. "Growing overall search share is job number one, and we need them to be successful with us," Ballmer said.

The CEO revealed that he's not a big Twitterer. He's said he's more likely to share his thoughts in a blog post than "a set of short tweets."

"I'm more of a consumer than an author in the real-time environment," Ballmer said.

But he does have a stealth Twitter account under an undisclosed name. "I was tweeting basketball scores, but you wouldn't know it unless you were a parent in the Lakeside basketball community," he said.

Asked if Microsoft should buy Twitter, Ballmer said it's "not clear" that would be a good move, and the microblogging service might be better off staying independent.

"They have a lot of credibility with the user community. Would they have that same credibility if they were captive [to Microsoft]? That's not clear," he said.

Facebook "very much wants to be an independent company, so we'll continue to work the partnership with them," Ballmer said.

Sullivan asked Ballmer if Microsoft is using smaller search companies as a way to raise antitrust complaints against Google. The European Commission said last week it was examining complaints against Google filed by three companies, some of which are linked to Microsoft.

"We're not being silent, we're expressing some of the issues and frustrations we see. Certainly sometimes that is unsolicited, but often times it's because we've been asked," Ballmer said.

"There are a set of issues we think are worth commenting about," he said. "Ultimately, what's lawful and unlawful is the purview of regulators. Don't we know it," he said, referring to Microsoft's own history with antitrust regulators.

Asked if Google has a "lock-in" on publishers or advertisers that makes it harder for other companies to compete, Ballmer said there are "a lot of places where it is hard to break through," but he said the conference wasn't the right place to "itemize" Microsoft's concerns.

He did suggest that Google retains data about advertisers' campaigns that those companies might benefit from sharing with other search providers. "There are still things Google holds in," Ballmer said.

Sullivan asked the audience of a few hundred advertisers, marketers and consultants if any of them were "frustrated" with Google's behavior, and only one or two hands in the room went up.

Search will be a bigger share of Microsoft's business going forward, Ballmer said.

"I guarantee search is going to be a growing share of Microsoft's profits. That means it's first got to break even, then get bigger, but that's a growing share the way I do my math," he said.

The biggest opportunities in search are in divining user intent and helping them complete a task, he said -- something Google and Yahoo are also working on. He gave the example of his own frustration trying to gather data about debt as a percentage of countries' gross domestic product.

"I knew what I wanted, I could have drawn an Excel spreadsheet and I just wanted to search to get the data to put in the spreadsheet. That shouldn't be that hard," he said.

Microsoft will keep investing in Cashback, a program in which Microsoft pays partial refunds to customers who make purchases through sponsored links on its site. But the company might make some changes while keeping the basic concept intact. "It hasn't worked fantastically, in the sense it hasn't completely changed the economics of the business. But it has certainly had positive results, so I'd expect us to continue Cashback."

Microsoft seems to have learned something from the privacy backlash that hit Google Buzz, its social networking project. Privacy is "a lot more in our mind post the buzz around Buzz," Ballmer said.

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James Niccolai

IDG News Service
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