Bing tries to be a better search destination. They compete with Google on search.
Googles business model isnt search. Googles business model is selling and displaying ads.
By taking a page out of Googles own playbook, Microsoft can destroy their archenemy.
Googles Predatory Playbook
Google makes money by selling and displaying advertising via a fully automated setup.
To continue to increase revenue they continue to sell more ads. To continue to sell more ads they need more advertisement space. And to increase the amount of valuable (eyeballs!) ad space, they need more advertisement vehicles or channels.
Googles strategy to increase the reach and breadth of its ad space is to destroy other monetization models. (Get it why you cant sell links? why paid content is bad? why thin affiliates should disappear?)
Their preferred tactic to destroy or reduce existing business models in the target market they enter is to launch a good enough duplicate product or service " and offer it for free.
Googles zero-cost model means their offer is win-win, even when failing.
Any ad click is profit. And if successful, the other players in the market have to change their premium model either by lowering their prices (thus eliminating a perceived value difference between them and Googles free offer) or by going ad-supported freemium: hello Adwords or DoubleClick or
Make no doubt about it: Google has no scruples in this area and will go as far as to offer the companies which business theyre destroying an ad-split.
The Destroyer Destroyed
If its all about the ads, if 97% of Googles revenue comes from advertising, then the target is advertising, not search, and the tactic is Free.
By turning the tables, making strategic alliances, and where needed dipping into its war chest, Microsoft can undermine, if not destroy, Googles business model.
Microsoft has a war chest half as large as Googles. They have twice the assets. They could buy Google and have money left.
Set up a free, points-based ad auction system modeled after Adwords: give advertisers what they want for free. Then, pay publishers on the click.
Approach large Adwords advertisers: make exclusive deals with them.
Find hurt folks and strike up strategic alliances: I know of a couple hundred news outlets that will love to help you.
Turn it into a community effort; have your efforts go viral.
Beat them at their own game and introduce your own less-than-free by dipping into your war chest.
How would you go about competing with Google? Can Google take away what you do right now in a heartbeat?
My paid passion at Search Engine People sees me applying my passions and knowledge to a wide array of problems, ones I usually experience as challenges. People who know me know I love coffee.