Microsoft Corp.'s (NASDAQ:MSFT) MSN and its other online businesses used to be a pretty big deal. They sat at the top of the pack with AOL and Yahoo! Inc. (NASDAQ:YHOO). That was before social networking and video sharing and ... Google Inc. (NASDAQ:GOOG).
Microsoft has brought in new blood to try to resurrect its fallen online operations. But it may take more than a transfusion to get the operations back on their feet.
There is some concern at Microsoft that it became overly focused on online software, like mapping, functionality, while allowing marketing to go to hell.
Microsoft really has three online initiatives but they may not be able to all exist together. There is the old portal business that competes with the likes of AOL and Yahoo!. There is a home grown search engine that competes -- though not very well -- with Google. And there is the Microsoft Live business that helps tether users of Windows and Office to the Internet and get additional interoperability and functions for software that is installed on PCs.
It could be argued that the search feature is the core of the online connection of Office productivity software and Windows operating system users. It is part of the overall efficiency of the Internet. So, search and Live can probably live together and be part of the same overall operation.
This leaves MSN, which has little to offer beyond what users get from AOL and Yahoo!. Since most of the services from these "portals" are free, MSN has to count on advertising revenue to fuel its income. And, as Yahoo! investors have found out recently, that is easier said than done.
Microsoft has two promising online businesses and a portal operation that is running far out of first place in that segment of the market.
Maybe AOL or Yahoo! would buy MSN. It is hard to see what Microsoft should do with it.
Douglas A. McIntyre is a partner at 24/7 Wall St.
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Reader Comments (Page 1 of 1)
12-12-2006 @ 10:18AM
Michael said...
MSN has been irrelevant for years. Portals have been irrelevant for years. MSN was a "play catch up" idea that never caught up. If MS were smart, they would cut their losses and just dump the portal, focus on search and make getting to the search utility easy. Having to type 'search.msn.com' in the address bar is anything but intuitive. Google figured out long ago that making the interface clean, simple and easy to get to, works. But as long as MS is so full of themselves, they will continue to be irrelevant.