While bashing Microsoft has always been common in the circles I run in, I've tried to do less of that in recent years. I know more people working there and have a lot of respect for them. I now understand that a lot of their problems are the result of systemic problems and sheer inertia.

But still, sometimes you see things that ought to be pointed out.

Henry Blodget's Microsoft's MSN: Still Sucking Wind After All These Years is rather eye-opening.

Did you know that MSN is currently losing about $1 billion a year (run-rate)?  That's right, $1 billion.  On about $2.2 billion of advertising revenue.  (See this page for details).  Unless Microsoft's disappearing access business is losing a lot of money--which we doubt--all of the division's losses are attributable to the advertising and media business.  That means that MSN is losing nearly $0.50 for every $1.00 of advertising it sells.

Not good when compared with rivals, it seems.

And then there's the employee retention problem.

Translation: We only grew headcount 12%, but we have to pay so much to retain and recruit people that our overall headcount expenses increased more than twice as fast.

He concludes by saying:

Don't forget that, in round one of the Microsoft's-going-to-rule-the-Internet wars, Microsoft accelerated dial-up subscription revenue and expenses in an attempt to catch AOL. That effort failed, as did several that followed. In the past 12 years, in fact, Microsoft's online story has had any number or re-orgs, restarts, and revampings, but the reality has never changed.

Makes you wonder when Microsoft will find their way on-line... if ever.

And then there's former Yahoo Bill Reardon's Microsoft Search post, which is a most excellent rant. He's got a talent for taking the obvious and making your realize how fucked up something is.

Reacting to the fact that Microsoft's Search finally has stemming:

They didn’t have these things before?!
Understanding “driving” vs. “drive”? That’s a pretty basic problem called stemming. How basic? Put it this way, there’s been open source code out there to this before there was a Microsoft Search. Fuck, even the Wikipedia page has existed since 2007. All they had to do was go there. I know Microsoft is big about “eating their own dogfood”, but damn, use Google just this once to find it.

He paints a pretty sad picture, and reading the Microsoft presss about their technology, it's hard not to agree with him.

Read the whole thing. It's worth it. Bill really cracks me up.

Don't even get me started on their "you can look but not touch" .NET source code release.

Hint: It's not like Open Source. Not at all.

Posted by jzawodn at October 04, 2007 07:20 AM

Reader Comments
# Bharath said:

I hate to sound like a stereotypical MS basher, but did I see a blog titled "Releasing the .NET source code"? ROFL. What a joke. They can learn a thing or two from OpenJDK, perhaps?

on October 4, 2007 08:28 AM
# Richard Barber said:



I read a couple of days ago about a Microsoft search upgrade, so did a few searches on popular terms that affiliates and providers are desperate to be top for...

Unfortunately, microsoft still hasn't worked out a way to differentiate between "brand" and product searches and always end up with lots of crappy results that have the search term in the Domain...

For a company that wants to dominate in search, they have a long way to go...

I personally don't believe that they are dead as they are one of the few companies that IF they can get a decent product on the market (for users first, not advertisers)they have the resources to really throw it out to the world.

The problem is, they haven't come up with anything good yet and they have had a while!

PS love all your flying related posts and pretty much everything else you post, Thanks...

on October 4, 2007 09:38 AM
# Michael Fagan said:

the comments on stemming aren't really accurate...

It's true that MS just *added* stemming, but that hardly means they weren't aware of it. Google only added stemming-like features less than two years ago... originally they described not having stemming as a feature, not a bug (you get exactly what you typed = good). Stemming is also a fuzzier problem than you might think, and "stemming" features may include things like acronym expansion, which doesn't work in a 1:1 relationship

on October 4, 2007 09:44 AM
# Ryan said:

If you want to talk about Microsoft search sucking, look at the latest live.com algorithm changes.

Search for "text message" and the top 2 results are godaddy landing pages.

Search for "payday loans" and you get 0 actual companies with brick and mortar locations.

Searching for viagra, #3 is just a thin affiliate

Search for microsoft, and the entire first page of results are microsoft.com

It looks like they threw up an old version of altavista from 1999... either that or the only factor it's looking at is domain names.

on October 4, 2007 11:39 AM
# Chris said:

Jeremy as I replied in a followup blog post, Henry's analysis seems to miss out some crucial facts about why they are making a $1bn loss. He implies its a long slippery slope they are on, when in fact up until their investment in Windows Live, it was profitable.

on October 4, 2007 01:13 PM
# Bob Warfield said:

It's a funny old world we live in where stemming is concerned. It has definitely been around forever, and it's easy to implement. Yet, how do you know if you've got it or not?

I search eBay for "binocular" and "binoculars" and get different results. Aha, sez I, no stemming! Those cretins!

Then I try the same on Google and get 2 different results. Mumble, mumble, what's up with that? What about this business of "driving" and "drive"? Type those into Google. 2 different results.

Hmmm. Maybe nobody stems. Or maybe they stem and some other part of the heuristics messes it up for just a few cases.

One thing is for sure, MSFT do know how to invest a zillion man hours in something without achieving much result. It isn't for lack of smart people, I have brilliant buddies there, but somehow, the brilliance is trapped inside.



on October 4, 2007 03:57 PM
# Grant Hutchins said:

The Wikipedia page has existed since 2007? That hardly seems remarkable!

on October 4, 2007 09:41 PM
# Patrick Hall said:

If you search for ["apartment maintenance" tipping], do you really want information about "tips"? No, tips and tipping are different...

Stemming sucks.

on October 5, 2007 12:37 AM
# MSHasACreepySide said:

1. Not exactly word stemming is it?

It should be verb tense grouping (driving driven drove...) and perhaps synonyms rather than just stemming (but something more complex is needed there, and playing with their search is disappointing).

2. If they're losing so much on search advertising then they're likely selling it at a loss to attract publishers no? You may wish to raise an anti-trust case on that. Selling at a loss is dumping however you dress it up.

3. It's perfectly OK to hate Microsoft, even if you like some of the people in it.

4. The search [tom yum gung] returns 0 results, which means they have a long way to go before their search engine is any good.

on October 8, 2007 01:01 AM
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