Microsoft Lost $5.5Billion on Bing since it launched in 2009.

[UndergroundWire]

NEW YORK (CNNMoney) -- Bing' date=' Microsoft's two-year old search engine, is losing nearly a $1 billion a quarter, with no sign of letting up.

Microsoft (MSFT, Fortune 500) has lost $5.5 billion on Bing since the search service launched in June 2009, but the company's search losses actually pre-date that. In fact, the software giant has never made money in its online services division. Since Microsoft began breaking out that unit's finances in 2007, the company has lost a total of $9 billion.

Story continues[/quote']

Source: http://money.cnn.com/2011/09/20/technology/microsoft_bing/index.htm?source=cnn_bin

Now that's gotta hurt.

[Tom]

#1 I think they can afford it.

#2 Bing is great for competition. Without it the search market would be a monopoly in Google's favor. For this reason I respect Microsoft a LOT for continuing with it.

[Rudy]

It's losing more and more every year....can't be good

[George P Global Moderator]

Why do people keep getting it wrong time and time again? The Online services devision != Bing alone. This tired bit of BS needs to stop already. The growing "operating" costs have gone up, which is what lead to the loss. That means they've been spending on building up the backend, more datacenters and so on. Online Services covers not only Bing but Windows Azure and also Office 365, two services that need a massive backend to support on their own, not to mention what Bing itself needs adds to the costs.

You can either grow the backend slowly over years like how Google has, which doesn't show up as a loss since you stretch it out. OR you build it quick like MS has, and take huge hits early as in "investment" for the future.

[greenwizard88]

x-post from what I wrote on reddit:

This article says Bing has ~15% market share and won't be able to be profitable until it's closer to 30%. Tech Crunch reports that Bing (+Yahoo!) have a combined 29% marketshare.

Additionally, the claim is made that Bing users are coming from not-Google, but elsewhere. I'm pretty sure that Google is losing users to Bing, seeing as no new search engines have emerged lately, and Google's market share is dropping.

And as Byronm mentioned, it's not Bing losing 1b a quarter, it's MS's online service division, responsible for Bing, Live, and Office365. Don't look now, but with Live built into Windows 8, the expendetures are about to skyrocket, while income remains flat - can you even pay for extra Live services?

Long story short: Who cares? Their online division is integral to Microsoft just as much as streaming is to Netflix. It's just broken up a little differently.

[M_Lyons10]

What people (For whatever reason) fail to recognize, is that Microsoft doesn't have to make money on Bing directly. They've leveraged it in just about every service or product that they offer and continue to expand its reach and innovate on its technologies... Do they make money on Bing itself? No. Do they make money on things powered by Bing? Absolutely.

[Farstrider]

#1 I think they can afford it.

#2 Bing is great for competition. Without it the search market would be a monopoly in Google's favor. For this reason I respect Microsoft a LOT for continuing with it.

Seriously?? The fact that you can afford something does not justify continuing with a project/product or service that becomes a bottomless pit! I wonder how long the shareholders will see it this way?

Do they make money on Bing itself? No. Do they make money on things powered by Bing? Absolutely.

... and on this utterance, I'm not really sure how to answer! Bing does not and never has made money?? What more is there to say? All that would happen, is that MS would need to find another vehicle to use for these products and/or services. They did it quite successfully before starting with "Bing"! If this trend shows signs of turning around and forecasts show that eventually it will recoup the financial losses, then good, carry on with it. If not, cut your losses! Surely this makes financial sense!

[threetonesun]

I don't think there's a company out there that doesn't have at least one division that loses money. You've got to spend money to make money.

[FMH]

So, my avatar is really costly.

But it's a really great project that I think would be huge in the future.

Google is currently facing several allegations on it's search monopoly. There will be some serious antitrust investigations in the near future.

Plus a lot of great things are happening at the Bing side.

It is going to be, or is integrated in Windows 8, Windows Phone, Xbox, Facebook and Blackberry.

And there are reports that some people are also making it's logo, their avatar.

[Daedroth]

Bing is still in it's infancy, and the search/image function is just a fraction of it's proposed functionality. With it's incorporation to Xbox and Metro, I'd like to see what happens in the next couple of years.

[Astra.Xtreme]

It's a little hard to believe they are losing $1b every 4 months. I'm sure they make a ton of money from advertisements and Live subscriptions, so that's absolutely ridiculous if they are losing that much money even offsetting their income.

[M_Lyons10]

Seriously?? The fact that you can afford something does not justify continuing with a project/product or service that becomes a bottomless pit! I wonder how long the shareholders will see it this way?

... and on this utterance, I'm not really sure how to answer! Bing does not and never has made money?? What more is there to say? All that would happen, is that MS would need to find another vehicle to use for these products and/or services. They did it quite successfully before starting with "Bing"! If this trend shows signs of turning around and forecasts show that eventually it will recoup the financial losses, then good, carry on with it. If not, cut your losses! Surely this makes financial sense!

Um... Because they ARE making money on their investment in Bing? But they're booked to other departments that Bing services are built into? Bing itself is really not structured to be this huge cash cow. It has tremendous expenditures, and the service is built into other products (That generate profit) as opposed to shipping independently and generating profit that would be booked back to Bing.

Why is this so hard to comprehend? It's not that abstract a concept... :?

[threetonesun]

It's a little hard to believe they are losing $1b every 4 months. I'm sure they make a ton of money from advertisements and Live subscriptions, so that's absolutely ridiculous if they are losing that much money even offsetting their income.

They do a crazy amount of costly promotions. I got ~$200 off a TV from a Bing promotion a few years back, and if you search with them now, they'll hand out free stuff. Not to mention that includes the cost of everyone working to integrate Bing into everything Microsoft touches, and make sure it does a decent job of coming up with search results, and hooking more partners into the shopping/travel services.

[George P Global Moderator]

Seriously?? The fact that you can afford something does not justify continuing with a project/product or service that becomes a bottomless pit! I wonder how long the shareholders will see it this way?

... and on this utterance, I'm not really sure how to answer! Bing does not and never has made money?? What more is there to say? All that would happen, is that MS would need to find another vehicle to use for these products and/or services. They did it quite successfully before starting with "Bing"! If this trend shows signs of turning around and forecasts show that eventually it will recoup the financial losses, then good, carry on with it. If not, cut your losses! Surely this makes financial sense!

Youtube was, and to a small extent, still kinda is a bottomless pit. Google has owned it how long? It's only recently started to break even and make a tiny bit of a profit. As my post clearly stated, the Online Services devicsion does NOT mean Bing only. The devision has growing costs from the fact MS has started other, equally big online services that need a lot of backend hardware to support. Windows Azure and Office 365 are huge in their own right and MS had them open in beta testing and free to use for how long? That was all on their own dime, and this "beta test" wasn't free. Considering those two services don't make money off of ads but off of subscriptions, since the beta was free MS wasn't getting anything back from them till recently when they both went final.

The point is, there is ZERO reason to ditch Bing, and the fact is people don't have a clue as to what and why the "Online Services" devision has these loses in the first place even when it's been pointed out time and time again. It seems every few months we keep getting a stupid article like this call for MS to can Bing when, first off, it's market share still grows and will get a huge boost from being a part of the Xbox and phone platforms, and also the devisions revenues have been actually growing from more ad sales, not going down.

[guru]

Bing market share will depend completely on how much innovation they bring to the table. MS atleast spoke to about the rights hings in nthe article. Execution is where Bing seems to have Challenges lately after a very good start (all those features google copied like better image search)

Metro + HTML5 Bing that was demoed ages back still isn't out. yet

and that isnt even "changing the game"

The point is, there is ZERO reason to ditch Bing, and the fact is people don't have a clue as to what and why the "Online Services" devision has these loses in the first place even when it's been pointed out time and time again. It seems every few months we keep getting a stupid article like this call for MS to can Bing when, first off, it's market share still grows and will get a huge boost from being a part of the Xbox and phone platforms, and also the devisions revenues have been actually growing from more ad sales, not going down.

couldn't agree more.

[Hendrick]

#1 I think they can afford it.

#2 Bing is great for competition. Without it the search market would be a monopoly in Google's favor. For this reason I respect Microsoft a LOT for continuing with it.

Yahoo was competition, until Bing took their search over. I know many people didn't like Yahoo, but I actually used to use it a lot.

[Eric Veteran]

Yahoo was competition, until Bing took their search over. I know many people didn't like Yahoo, but I actually used to use it a lot.

I liked Yahoo when it was still a college project. :p

http://en.wikipedia.org/wiki/Yahoo!#History_and_growth

[FMH]

^ @ Hendrick

[grik]

Bing failed because it came from MS, it gives the sense of profit that google doesn't, yet google profits alot more of course. Another thing, google didnt publicize

, google makes everyday cartoon in main search window, adapted to eatch country or event, its coding for people, and not coding to earn people.

Its good for competition and its a must have for MS, they loose on one side but i think they earn on some other, notoriety.

[Gigi Buffon]

1. BING DID NOT MAKE $5.5 billion loss. It was the ONLINE DIVISION.

2. Bing has continued to eat away at Google's market share EVERY SINGLE MONTH. And eventually it will replace Google as the most popular search engine. Remember XBOX made losses early on. But now it has DESTROYED PS3. The EXACT same thing will happen with Bing and Windows Phone 7 which will DESTROY Android.

3. $5.5 billion is PEANUTS compared to the profit Microsoft makes with Windows and Office. Unlike Google, which makes ALL its money from search, Microsoft doesn't need Bing to make money. So, they can continue pumping money into it forever.

[Vice]

It is amazing to me that they have managed to lose 5.5 Billion dollars on this. Where the hell did all that money go?

1. Coding it

2. Servers to host it

That is the only outgoings they have apart from like the cars for mapping streets. No bull**** yeah but I could get Bing coded and setup in 6 months on a budget of $25 Million easily. And I reckon I could fully fund it for 3 years on that amount. 5.5 Billion is just an insane amount they must have been keeping their buildings warm by burning $100 bills in a furnace.

[revvo]

Obviously, how can you profit from an engine based on Ned Ryerson?

[FMH]

It is amazing to me that they have managed to lose 5.5 Billion dollars on this. Where the hell did all that money go?

1. Coding it

2. Servers to host it

That is the only outgoings they have apart from like the cars for mapping streets. No bull**** yeah but I could get Bing coded and setup in 6 months on a budget of $25 Million easily. And I reckon I could fully fund it for 3 years on that amount. 5.5 Billion is just an insane amount they must have been keeping their buildings warm by burning $100 bills in a furnace.

So you are saying that they are faking these losses?

And what are you talking about coding something like Bing in 6 months?

It was a project worth thousands of people, acquisitions, billions of dollars and years of time.

Those people could have certainly found you useful.

[greenwizard88]

It is amazing to me that they have managed to lose 5.5 Billion dollars on this. Where the hell did all that money go?

1. Coding it

2. Servers to host it

That is the only outgoings they have apart from like the cars for mapping streets. No bull**** yeah but I could get Bing coded and setup in 6 months on a budget of $25 Million easily. And I reckon I could fully fund it for 3 years on that amount. 5.5 Billion is just an insane amount they must have been keeping their buildings warm by burning $100 bills in a furnace.

Someone didn't read the article! :whistle:

It's Microsoft's online division, which features Bing. Not Bing alone. Silverlight was, until quite recently, a part of the online division. So basically, a good part of developing WP7 (which runs off of silverlight) was thrown into the online division. The same with Office365. Come to think of it, writing a good chunk of an OS for a mobile phone, running a search engine, and porting the most widely used offcie suite in existance to a different platform, for less than 6 billion, isn't too bad.

TL;DR: It's not just Bing.

[grik]

It is amazing to me that they have managed to lose 5.5 Billion dollars on this. Where the hell did all that money go?

1. Coding it

2. Servers to host it

That is the only outgoings they have apart from like the cars for mapping streets. No bull**** yeah but I could get Bing coded and setup in 6 months on a budget of $25 Million easily. And I reckon I could fully fund it for 3 years on that amount. 5.5 Billion is just an insane amount they must have been keeping their buildings warm by burning $100 bills in a furnace.

Bing didnt had TV comercials? like...lots?

All this is paid, and i bet it announced outside USA too.

Its not "BInG" suprise :)