Microsoft to spend $2.25 billion a year on search

Steve Ballmer’s is on a battle front in the online search engine market with the launch of Bing, he has made his intention very clear that Bing will be a serious contender to Google and Yahoo’s share in the search market. Microsoft’s share of the US searches is about 8 % , a distant third behind Google and Yahoo.

A look at Microsoft’s different search efforts in the last six months (the bid to buy Yahoo’ search capabilities and the successful launch of Bing ) shows that Steve Ballmer is a persistent guy. And now, Ballmer may be ready to try harder than ever, as he’s voiced a willingness to spend something like $2.25 billion per year on search.

According to Reuters , Ballmer said at a business lunch, “Our shareholders, I told them we were willing to spend 5 to 10 percent of operating income for up to five years in this business, and we feel like we can get an economic return.”

Bing grabbed 12.1 % of the US Internet searches for the june 8 – 12 work week, up from 11.3 % from June 1-5 compared to Google’s 65 % of US searches in May. Ballmer is counting on Bing’s ability to provide more focused search results to lure web users away from Google and Yahoo. Bing was launched this month replacing the company’s previous Live search engine.

Microsoft’s operating income in 2008 equaled $22.49 billion, so that’s a not-quite-commitment of about $1.12 billion to $2.25 billion annually or more, since Microsoft’s likely to pull in greater sums of money in the years ahead.

Ballmer said, “In our industry, the number one mistake that people make is that they quit too early. We should have started earlier, but we’ve got our mojo working now I am willing to be patient to give Microsoft’s Bing search engine time to catch on with web users ”