Ecosia, which uses results from Bing and invests its profits in environmental projects, is considering potential partners to develop its own chatbot. Its executives are said to be eager to license Bing’s chatbot technology if Microsoft agrees to share. “It’s important to make sure it’s not just another tool for these companies to further entrench their dominance,” says CEO Christian Kroll.
The small search player escapes Bing’s price increases because it’s a syndication partner from Bing, which means it repackages both Microsoft’s ads and search results and gets a breakdown of ad sales. However, Kroll says the multiple fee jump for Bing API customers is an “urgent red flag” signaling a market with large power imbalances that the European Commission (EC) should regulate under the Digital Markets Acta law enacted last year to ensure small companies can compete with big tech on a level playing field. EC spokeswoman Arianna Podesta said the DMA will come into effect on May 2, although which online search engines will be covered could take months for regulators to determine.
Bing serves less than 3 percent research in the world, estimates the analysis service StatCounter, far behind Google, which takes 93%. But Bing’s share is over 8% on desktops, where Windows is the dominant operating system and Microsoft gives its own search engine preference.
Search ads on Bing search results are a critical part of Microsoft’s $18 billion in annual advertising revenue. Every 1 percentage point increase in market share could translate to $2 billion in additional ad sales, Microsoft chief financial officer Philippe Ockenden told analysts last month at the launch of his chatbot. Microsoft is not busting Bing API sales.
The race for chatbots sparked excitement for the first time in years about the competition between Bing, Google and everyone else. You.com’s Socher says users up until recent months have balked at features that were unfamiliar to them. “People would say, ‘I’m so used to Google. I don’t want it to be too different,’ he says. Now users seem open to new experiences. ‘It’s just a new, different world,’ he said.
Sivakumar, which builds shopping search service Tonita, says Microsoft could have more success with its chatbot if it opened it up to other companies to license on reasonable terms, gaining wider use. and driving more consumers away from Google. Microsoft’s management of its existing APIs does not inspire optimism. He decided not to use Bing APIs due to their long-standing terms of service don’t let customers modify, store or process search resultslimiting the potential application of the data.
The same technology enabling Microsoft’s search renaissance also makes it easier for businesses to imagine going without Bing. after building Neeva research start on Bing’s API, CEO Sridhar Ramaswamy said user bug reports of misinterpreted queries, outdated results and other quality issues convinced him to change course in late 2019.
Neeva tapped into its $80 million funding to develop its own system to deliver results, though it still relies on Bing for image and video searches. The startup has benefited from the hiring of former high-profile Googlers, cheaper memory for servers, and the advent of LLMs that have made it easier for software to understand misspellings and synonyms, despite limited user data to analyze. Ramaswamy says the project has “more than paid for itself”, enabling the launch of the startup’s rapid response tool NeevaAI in January.
Bing is still not easy to oust. Like Google, Microsoft has a large ecosystem of products and services that can help direct people to its search field. Some users have complained that Windows is resetting Bing as their default search engine from their preferred alternative. (Microsoft says it’s committed to users being in control.) Microsoft also requires use of its browser or mobile app to try out the Bing chatbot, powering an increase in downloads. According to Ramaswamy, “If we enter a world in which there are only two big players with the infrastructure and the research expertise, clearly they will not accept competition.”
Updated 03/27/2023, 2:45 PM ET: A comment from a spokesperson for the European Commission has been added.