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Originally Posted by rex_b MSN = unlimited budget. They are doing this just for fun I would think. They could buy google in one foul swoop. |
Actually, any time Microsoft wishes to buy something it has to be reviewed by the courts under law. Microsoft actually sees Online Distributed Computing as the future so I don't think this is simply for fun. It represents a new revenue stream to keep the company strong.
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Saying that I would watch for MSN to become more popular over the coming years, if they can break google's branding, which will be very hard.
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I see it as a way of them leveraging the traffic they already get. Microsoft's MSN is the second largest trafficked site in the world, second only AOL's. Currently, they contract out searching to several different companies. By bringing this inhouse, they can control costs and increase revenues from search. They are also use it to tie into existing content as I said. If you ask the search engine a question such as "What is the capital of France?", it will link to the answer in Encarta. This creates circular traffic which will allow increasing ad revenues.
Microsoft is really a solutions company. Software happens to be one of those solutions and this is another.