zett - 4:16 am on Jan 21, 2010 (gmt 0)

In fact, it would be pretty easy for Microsoft to turn around this game. Just develop products with webmasters and consumers in mind (i.e. serve their needs). This could be, for example, an alternative to Analytics, a more transparent version of Adsense, search queries that get quickly anonymized (they did that one recently) or not stored at all. Then get the word out to the relevant target groups (webmasters, consumers) and see the traffic roll in.

Google is hampered by their own product vision. They think that data is everything, and that they have to build products that spy on people and that are monetized through advertising only. Now, until now this might have been a strength (because it allows you to offer free products), but once sentiment of the target group changes, e.g. privacy getting more important, you're in trouble because your model crashes. On the other hand, IF you build your business with this limitation in mind (i.e. respecting the mind shift of the target group) you can easily hit the competitor massively.

I think this is what Microsoft is doing right now. At least it starts to realize the weaknesses of Google and looks at ways to address these specific shortcomings with products. Marketing 101.

For my taste, they are still too soft on Google, but the introduction of Bing marked a substantial change in the way Microsoft acts. And this is a good change IMO.