Bing struggles to make money, Microsoft stays optimistic

The software giant has lost more than US$5 billion (AU$5.6bn) over the past four years trying to establish an online business capable of rivalling Google's, but hopes to reverse the disappointing trend once the company seals a search advertising partnership with Yahoo.

"As soon as we close and implement the Yahoo deal, we have achieved a milestone: for advertisers, we are a credible No. 2," said Yusuf Mehdi, senior vice president of Microsoft's online audience business.

"Really now, the goal is about share gain. If we grow share, we will grow our way into profitability, and we have confidence we can do that," said Mehdi, who is charged with making Bing and the MSN portal a financial success.

Microsoft now has 10.7 per cent of the U.S. search marketplace, according to ComScore, up from 8 per cent before Bing's launch in June last year. But it still trails Google's 65.7 per cent and Yahoo's 17.3 per cent.

If and when U.S. regulators soon approve the deal that makes Bing the underlying search engine for Yahoo, Microsoft will then effectively control almost 30 per cent of the search market - a key number for advertisers.

"At 30 points we are now a credible option, so that number matters," said Mehdi. "The nice thing is we can say (to advertisers) you can be close to 30 per cent share in one easy buy. That 30 per cent carries a lot of weight in the marketplace."