By Matt Rosoff [bio]
Posted: Mar. 13, 2006

The following is the full text of an article published by Directions on Microsoft, an independent research firm focused exclusively on Microsoft strategy & technology. More samples of our content, as well as a list of upcoming articles and reports are also available.

Windows Live Search has entered public beta, with feature and interface improvements that distinguish it from its predecessor, MSN Search. However, Microsoft's search site continues to lose market share to competitors Google and Yahoo, and the latest improvements are unlikely to reverse that trend.

In other Windows Live news, Microsoft has acquired Onfolio and will incorporate its technology, which helps users aggregate Web material offline, into the new Windows Live Toolbar. It has also updated several other Windows Live services since their launches in late 2005.

Search Improvements

The public beta of Windows Live Search, which launched in Mar. 2006, has several interface changes that will help users scan results. For example, instead of forcing users to load new pages to view additional search results, Windows Live Search places all search results on a single page, then allows users to scroll quickly through those results with a slider. Paid search results from advertisers are automatically updated in the right column as the user scrolls—a feature that could improve the prominence of (and click-through revenue from) lower-priced advertisements.

Other improvements will help users narrow their queries to get more useful results. For example, users can search within particular categories (such as news, images, or RSS feeds) and create and save frequently used complex searches (a feature called Windows Live Search Macros).

Microsoft's focus on interface improvements, however, does not address the most important factor in search engine usage: relevance. A search engine should display relevant results in the top few listings for most queries, eliminating the need for users to scroll through many results or spend lots of effort tailoring their queries. Although Microsoft says it continues to improve its search algorithms, its market share dropped from 12.8% to 11% during 2005 according to Nielsen NetRatings. During the same time, Yahoo Search's share grew from 21.2% to 22.2%, and market leader Google's share grew from 47.1% to 48.2%.

Other Updates

Microsoft also launched or updated several other Windows Live services in Feb. and Mar. 2006.

Windows Live Toolbar. This downloadable add-on for Internet Explorer (IE), which entered public beta at the same time as Windows Live Search, will replace the MSN Search Toolbar. The new toolbar includes technology from Onfolio, a privately held company that Microsoft acquired for an undisclosed sum in Mar. 2006. With Onfolio, users can collect information from Web sites and Outlook e-mail messages, including snippets of text and graphics, full Web pages, multipage articles, and even full Web sites, and store this information in offline files where it can then be searched, annotated, e-mailed, posted to an RSS feed, or shared with Office applications.

Like its predecessor, the Windows Live Toolbar adds numerous features to IE, such as tabbed browsing, pop-up window blocking, phishing alerts, and automatic form fill-in. Many of these features have also been incorporated into IE 7, the next version of the browser, which is currently in public beta.

Windows Live Local, Microsoft's mapping and directions site, is previewing street-level views of locations. Similar to Amazon.com's A9 mapping site, these views of local landmarks, businesses, and other features are not visible from the satellite or 45-degree angle images already available on Windows Live Local. Although the preview covers only two locations—downtown San Francisco and downtown Seattle—the partner providing these images, Facet Technology, has more than 700 million images encompassing more than 500,000 miles of streets in major metropolitan areas in the United States and plans to photograph high-volume roads (such as highways) as well. Microsoft will add these images to Windows Live Local over time.

Windows Live Messenger (in private beta), the successor to MSN Messenger, Microsoft's consumer instant messaging (IM) and real-time communications client, has an improved Voice-over-IP stack that will make it easier for Windows Live Messenger users to place PC-to-PC voice calls through firewalls.

Windows Live Expo. Microsoft's online classified advertising service, formerly known as Windows Live Classifieds and code-named Fremont, is now available in public beta. Although similar to Craigslist, the Microsoft service allows users to limit their advertisements to people on their Messenger contact lists or to particular e-mail groups (such as specific domain names). This feature could be useful for selective distribution of listings (e.g., only within the poster's workplace) that include personal information about the poster, such as a home address or phone number.

Resources

The Windows Live Search beta is accessible only from the Live.com home page at www.live.com

Download the Windows Live Toolbar at ideas.live.com/programpage.aspx?versionId=f53eeee8-de38-45c8-bc6d-a4749e827cc5&page=1.

Onfolio's features are described in detail at www.onfolio.com/product/toolbaraddin. (Note: Onfolio is no longer available as a separate download—it must be downloaded as part of the Windows Live Toolbar.)

The Live Local preview featuring street-level images is at preview.local.live.com.

Facet Technology's SightMap service, which provides street-level images to Windows Live Local, is at www.facet-tech.com/SightMap/SightMap.htm.

Windows Live Expo is at expo.live.com. For background, see "Windows Live Adds Classifieds, Local Search" on page 32 of the Jan. 2006 Update.