At the start of 2023, many experts were raving about Microsoft’s new Bing search engine, featuring a superpowered artificial intelligence (AI) engine.
“Bing Chat could be a game changer” headlined some. “We may be witnessing the beginning of a new era, a renaissance, which one might even call ‘Bing-aissance’,” the others wrote, seemingly without batting an eyelid. “Bing is the king” was a title on a website that was not Le Gorafi.
And then, six months later, the Wall Street Journal deflates all that with an article that calls the new Bing Chat “cute, but not a game-changer.” At ZDNET, Lance Whitney concluded that “Bing’s new features have failed to revive Microsoft’s share of the search engine market.” As proof, he cites the same figures used by the WSJ:
Statistics from Statcounter show that Bing’s market share was 2.99% in July, down slightly from 3.03% in January and up slightly from 2.76% in April. Similarweb data shows that Bing’s share was 3.23% in June, a relatively stable figure since the start of the year.
So what do these numbers mean? StatCounter does an admirable job of identifying major trends, such as the shift from desktop to mobile devices and the relative position of web browsers. But the numbers from StatCounter tell us absolutely nothing about search engine market share. And don’t take my word for it. Read this disclaimer on the StatCounter FAQ:
Is Bing Chat included in search engine market share?
We have no way of measuring the number of requests made in Bing Chat. However, we also do not measure the number of queries made to traditional search engines such as Bing or Google. Instead, we track referrals to search engines.
For example, if you go to bing.com, search for something and click on the result of a website, we will record this click as a link to a search engine if the code statcounter has been installed on this website. It is the click to a website that we measure, not the actual search queries that have been made.
That changes everything, doesn’t it? StatCounter measures the last click – the one that took you away from the search engine – and does not count any activity on the page itself. What the StatCounter data tells us is that among the sites that use the StatCounter tracking servicethe impact of Bing referrals worldwide, across all platforms, hasn’t changed dramatically in the past six months.
Bing Chat only works in Edge or with the Bing app on mobile devices
But even this assertion needs to be qualified. Bing Chat only works in the Microsoft Edge browser or with the Bing app on mobile devices. It is therefore not possible to use it with the most popular browser in the world, Google Chrome, or with Safari, the default browser for Apple’s mobile devices. Given these hurdles, global numbers across all platforms are unlikely to change much.
You can play around with some of StatCounter’s charting tools to see the different segments in action. For example, excluding mobile and tablet platforms, and looking only at desktop search statistics in North America since the launch of Bing Chat in February 2023, Bing referrals are in up 2.2%, while those of Google are down 2.8%.
I wouldn’t advise taking these numbers too seriously, though.
The WSJ also cites SimilarWeb. On its FAQ page, “How We Measure the Digital World,” the company says it generates more than 10,000 reports per day.
If you dig deep enough, you’ll eventually come to the “Search Engines Market Share” page, which offers the same kind of customization tools as StatCounter. Based on these figures, in June 2023, Bing had a global market share of 3.23%. This figure jumps to 8.79% if we only consider desktop platforms. Similarweb offers a line chart, but none of the data points are labeled, so it’s hard to tell if there’s been any movement over the past year.
There’s so much noise in all these numbers that it’s really hard to find the signal, which is why the search engine market share graph contains this warning:
This traffic and engagement data is based on aggregated and anonymized analytics shared with Similarweb by millions of websites and apps and represents over 500 billion page views. This data relates to a subset of sites and is therefore an estimate of the market share.
A third analytics company cited by the Journal is YipitData, which offers no information on how its numbers are collected. Three of the company’s six most recent blog posts are about bathroom renovations, and nothing else on the page indicates the company has any special knowledge of AI or research. .
For Microsoft, a half-percentage-point gain in global use of its search products would be huge
For Microsoft, even a half-percentage-point gain in the worldwide use of its search products would be huge. But without knowing the margin of error, it’s hard to trust the numbers the WSJ takes as gospel. Also, I think they’re probably missing the point.
Again, don’t take my word for it. In a confidential strategy document from 2022 that was accidentally disclosed during a lawsuit, Microsoft CEO Satya Nadella spoke about Microsoft’s Search, Advertising, News, and Edge (“SANE”) segment in these terms:
We capture ~2% of the $560 billion Total Addressable Market (TAM) in the SANE segment. With a turnover of 10 billion dollars, we are a large digital advertising company and our products are competitive. …
Increasingly, we are closing the gap between us and our big competitors when it comes to product experience, as demonstrated by objective user feedback. In some cases, our products are considered the best. However, our market share does not reflect this, as there are a series of structural barriers, each of which is difficult to overcome. However, we see steady improvements over time.
“Dramatically changing the scale of our advertising business”
The real goal, Nadella’s memo continues, is to “radically change the scale of our advertising business.” This is a high-impact lever for us given the size of our install base, and even small gains from funnel refinement can translate into big gains in terms of operating margin.
In other words, maybe Microsoft isn’t trying to compete with competitors: Maybe Microsoft isn’t trying to compete head-on with Google Search after all.
Microsoft’s revenue from search and advertising would be a rounding error for Google, which pays twice that amount each year to Apple just as a bonus for sending search traffic to Google on iPhones. iPads and Macs. But this is a secondary activity for Redmond, with great room for development, in particular by encouraging these customers to switch to Edge from their Windows PC (a billion people). Annoying? Absolutely. But it is also a sure source of additional income.
Microsoft’s goal with Bing and Edge is not to take Google’s place as the world’s number one search engine. The goal is to grow an advertising business that is already proven to be an additional segment that brings in at least $10 billion in revenue for Microsoft each year.