In this case Microsoft means more than just Messenger, and will also allow the user to access Facebook chat through the same system. I imagine Skype will be added as well at some point. The phone will also select the service based on the activity:

For example, if we’re both online in Messenger, it will use Messenger IM so that we can share rich photos and more, but if we’re Facebook friends or just have each other’s phone numbers, it will automatically select the right service for our conversation.

Adding SMS and IM to the same conversation thread makes a lot of sense for Microsoft, especially considering how they are building their social networks, including their recent, widely publicised acquisition of Skype (I do not think they will restrict Skype to Windows, that would just be silly). Messenger is also able to connect with Yahoo! and Facebook, and in November last year, their Messenger app was the second most popular on Facebook, after Farmville.

The High Cost of Microsoft's Evil Skype Plan

Networks of Social Networks

When the Windows Live blog published their Preview of the new Windows Live Messenger in April 2010, they made a number of interesting points in line with some of their most recent published studies on user behaviour:

• People use multiple devices
• People use multiple platforms
• Publishing the same message to all platforms is not good User Experience
• People want to see more from some more than others in their own networks

Through building a network with partners and acquisitions, Microsoft is expanding Messenger’s reach beyond their install base. Both Facebook and Google seem to be trying to achieve the same with their social graph, and suite of content and social tools respectively.

In addition to access to a larger network of individuals, Messenger’s network of partners, and the integration of SMS through the Windows Phone 7 update, creates a unified communication experience. The user can follow a conversation they are having with another across multiple platforms in a single coherent thread. Other platforms appear to be implementing the same ideas, for example, Facebook Connect’s new Comment Box plugin is another example of effectively expanding the activity of a social network site beyond its own domain, creating a more unified social experience for its users.

With huge growth expected for mobile, providing better tools that offer a seamless experience across computers, tablets and phones is more important than ever. The growth for smartphones and numbers of users using multiple devices for 2010 show how big this can be:

Global Internet Use by Device Type for 2010

• 2 billion Internet users in 2010
• 400 million Internet users only use a personal computer
• 975 million Internet users use both a personal computer and a mobile phone
• 625 million Internet users only use a mobile phone

• 1.38 billion new mobile phone handsets sold 2010 (almost all with a browser and a colour screen)
  • 22% of all new phones sold 2010 (298 million) were smartphones
  • 1.2 billion personal computers in use globally 2010

(Source: All the Numbers, All the Facts on Mobile the Trillion-Dollar Industry. Why is Google saying: Put your Best People on Mobile?, Communities Dominate Brands, Ahonen, T)

What Are They Doing, not What Are They Using

Integrating SMS and IM on mobile makes sense: both are predominantly text based (posting images, video and MMS aside), both tend to use short messages, and both use similar interfaces. Their differences are more a result of the associated technology than user behaviour. SMS, voice calls, IM and voice over IP (VoIP) were separate because they had to be. As devices become more powerful and able to perform a greater range of tasks and support more functions, the differences between them and other computers diminished.

The popularity of applications like Tweetdeck, and others that support conversations held across multiple platforms, indicate that there is a desire for this kind of integration. Ultimately, the user cares about what they want to achieve, such as following the news, catching up with friends or organising to meet for coffee. The platform doesn’t matter, only the interaction.

Music in the cloud, and buying Skype

A Distributed Microsoft Social Network

Microsoft has a successful email service, a popular gaming platform with an online social network and a messaging client with a large install base. Also at the end of last year, Microsoft released a Facebook app for Live Messenger and began to incorporate social feeds into their own mobile and desktop chat clients. Microsoft already has a network covering multiple platforms and devices. Skype is an expansion of this network, and with Qik, it certainly shows some potential for mobile.

A more social Live

Reaching the Multi-Screen, Multi-Device, Multi-Platform User

There is more than one way to reach a new destination on the Internet. There is also more than one kind of software to use, device to operate and method to find new things. An Internet where banners and search advertising displayed in a browser are the only means of advertising no longer exists.

Mobile, gaming and social platforms are as important for building awareness as online advertising targeting desktop computer usage. The Microsoft Advertising blog has published a lot of content on reaching the multiscreen consumers, and advertising across multiple devices.

Buying An Audience

A number of interesting stats on Skype users were shared after the announcement. The most impressive was Skype’s current 170 million users and 40% year over year growth.

Buying Skype (with Qik in tow) gives Microsoft more users, much in the same way that their deal with Nokia will increase their Windows Phone 7 install base from 1.4% in Q4 2010. Even if Nokia loses an expected market of 50 million smartphones in 2011, the market share left by the time a Windows Phone 7 handset arrives will still be more than Microsoft has now.

Attention is all online

With information as easy to create and publish as it is now, it is curation that matters. Curation is more than a directory and a search engine now. Microsoft’s range of services, software and devices position them for a post-PC world, with its fragmented user experience. Microsoft’s own published reports say that we now:

…start our sessions in what I would call our intimate zones seeking personal information and contact through email, social networks, blogs etc.

Microsoft is building a distributed social network, covering computers, gaming, mobiles and tablets. They are creating a platform that can include Hotmail users, Xbox Live users, Facebook users, Windows Live users and now, Skype and Qik users. It reaches consoles, computers and mobiles and is accessible from different devices and platforms. It just isn’t limited to a single domain.

But do not mention the content farms

This February has been a month of drama for the search industry. It started with Google accusing Bing of cheating at a search panel at the start of the month. Google followed up the lively panel discussion by publishing a lot of screenshots explaining why they are convinced that Bing was using their search results as a ranking factor.

The write-up on how they did this is pretty comprehensive, but just briefly: they planted artificial queries and set sites to rank for them within their own live directory. They then used the queries and clicked on the links they planted there with computers running Windows, Internet Explorer and with the Bing toolbar installed. It was published on Google’s official blog after the talk, and found its way into the USA’s mainstream media, in a severely abridged form. Bing responded shortly after as well, and put their case forward on their own blog.

In the discussion that developed around this very public fight, kilobytes of text were used to list which search engine came up with what. Google’s copying of Bing’s left column and infinite image search scroll were mentioned, as was Google’s universal search. Issues like whose content Google was incorporating into their own product, sometimes against the owner’s wishes, emerged too. Google’s original statements regarding their own manual control over a site’s position in search emerged, and their original statement “we do not have the capability to manually change it” was brought up.

In all the excitement however everyone seemed to forget what the search panel was expected to be about: content farms, and poor quality content funded by AdSense. The discussion about search quality that permeated the search and Internet marketing community seemed to be forgotten. Even the long running debate over whether or not Google was favouring their own products, such as YouTube and Google Places, was forgotten for a little while.

Adapted from BrisbaneOnlineMarketingMeetup.com – Purported SocMed / Digital Marketing Gurus

In Australia, we expect to transition Yahoo!7′s organic search results (the non-paid listings found on the main body of the page) to Microsoft during January 2011.

The change in their paid listings is coming later in the year:

The transition of your paid search account to Microsoft technology is scheduled to take place in the second half of 2011.

For months now both Yahoo! and Microsoft’s blogs have been discussing the change and how to switch over for the USA and Canada. In those markets, the deadline for transitioning from Yahoo! to Microsoft Adcenter was today.

Here in Australia, we should be able to expect the same level of information during the transition period, as outlined in today’s email:

Approximately three months prior to the transition of your paid search account, we will begin sharing more detailed information with you, to help you prepare for the changes to come. Until then, please continue to manage your Yahoo! Search Marketing account as usual.

There will be one important difference between the switch in the states and here in Australia; Microsoft Adcenter is not active locally. To date Bing’s paid listings have been driven by Yahoo! Search Marketing. Personally I expect to see Microsoft Adcenter introduced into Australia well before the changeover date, to allow Yahoo!’s current Search Engine Marketing customers to migrate their campaigns across.

Other than a change of interface, there will not be any real change in how the SEM marketplace operates in Australia. Unlike in other markets, where they have gone from three to two SEM products, Australia has only had Yahoo! Search Marketing and Adwords. This deal does mean the final end to the SEM product that Overture (Previously Goto) spawned, and that, at least, is significant.

Microsoft has been involved with and developing social tools for a while and the number of accounts on Windows Live Messenger, Hotmail and Xbox Live has always been impressive.

According to the Windows Live blog post:

We’re still early in the release, but to date, over 10 million people have connected their Facebook accounts with Windows Live.

The engagement figures are impressive as well:

…there have already been over 250 million chat conversations between Messenger and Facebook customers, and these conversations have lasted more than 1.5 billion minutes.

The most interesting trend is cross-device software and platforms, including TV, via Xbox Live, mobile, computer and almost certainly tablets. The Microsoft Advertising blog hinted at where this may go with their post, Multi-Screen Consumer Research and Your Media Multiplier Effect. Creating a cohesive experience from desktop to mobile and to loungeroom is going to create changes in media consumption and user behaviour. Already behaviours are less restricted by software, platforms and devices. Microsoft Live Messenger and Facebook are connected and even console systems such as the Xbox360 are used as de facto social network devices:

…4 million personal messages are sent between Xbox LIVE members every day.

From online social interactions on both mobile and console systems, to product search initiated on mobile, and ending with a purchase via PC, integrating multiple media formats into the one chimeric experience will be disruptive. Especially as the media they consume becomes less dependent on the device and its location, and expectations for data portability change.

Ultimately it is the task a user seeks to complete that matters. Their objectives are more important than the device, platform or software used. What has begun to happen with the Windows Phone 7, Xbox 360 and the Windows OS is a hint on where technology is going. Making social, search and basic everyday computing functionality available no matter where the user is or what they have in front of them is the killer app. The device and platform do not matter: the user only cares if they can complete their task.

The real question is how much and for what. Friends and acquaintances need personal information to maintain relationships; Facebook requires it for access to their platform. An email address is standard currency for admittance into most social websites and Google uses location, search history and much more to provide a more meaningful search tool and more relevant ads.

Google’s newest product, Google Instant, also relies on this user data. The live blog of the launch event posted on Readwriteweb.com hinted at past user searches being used to generate SERPs as the user enters their query for very real performance benefits.

How does Google scale this? Optimizations: prioritizes searches that are the most likely. Checks if users is doing searches on another server. Results cached.

Where this deal breaks down is if the information is used in a way the user was not expecting. Entering an email address to post a comment is no big deal, but if it is then used to distribute spam, there is a problem. This surprise and betrayal of expectations is a large part of why Facebook’s users reacted badly to most of the site’s changes, and the same again with Google Buzz. The other issue is a lack of universal agreed value.

One degree from evil

It is the fluid nature of these transactions that has created campaigns and conversations like these. One of the more interesting exchanges was between this defense of Google and this subsequent rebuttal.

Users will always exchange their private information for benefits. How much they are willing to give up will vary from person to person. One thing is consistent though: expectations for how the information will be used need to be set, managed and met, or they might find that what you have is just not worth the price.

All users of Hotmail, Messenger, or Xbox Live automatically have a Windows Live ID, a single login that gives the user access to many Microsoft services. From ComScore’s 2 Million More Australians Go Social in 2009 report, Microsoft Live’s web presence had 1,962,000 unique visits in June 2009, just behind MySpace in Australia.

This does not include people using Microsoft’s services such as Xbox Live and Windows Live Messenger. With the addition of more web services to Xbox Live, Microsoft is certain to increase the use of their social platforms.

The first thing that struck me about the Microsoft Live profile pages and tools is the lack of opacity within its network. There are not many tools for sharing content or for finding new connections compared to sites like Facebook. It is easy to aggregate content from Flickr, RSS feeds and a number of other sources on the profile page but there is a lack of third party tools and applications. Microsoft’s main strength lies in their other products, and not in their web presence. In future it is their gaming platform and email services that will expand their reach.

In this regard, the most significant development for Microsoft will be cross platform gaming, encompassing Xbox360, mobile and desktop computing.

Xbox Live gives its users the ability to find new connections, share relevant content and access a lot of third party content via DLC games. It also provides a structured environment with engaging tasks, much in the same way that MMORPGs do the same for the social environments they create. There are other platforms that incorporate a gaming mechanic (Foursquare.com), have third party developers build one (Facebook.com), or have seen one emerge from user interaction (Twitter.com). It will be interesting to see how cross platform gaming, and applications in general, evolve in both their functionality and in how they are used going forward.

With the option of now adding additional links and other content to an AdWords listing, the look of some AdWords ads is closer to that of organic search. If I were to have a tinfoil hat moment, I might go so far as to say this could potentially lead to the effective monetarisation of organic SERPs returned for branded terms.

NIB Search Engine Result Page

There is one thing that has driven this renaissance of the text ad by Google, and that is the fact that disruptive advertising can work. AdWords, Yahoo Search Marketing and Microsoft’s adCenter have worked because with all the tracking available the advertiser can prove that the money spent has a return, without falling back on nebulous metrics such as branding. With SEM, disruptive advertising does work, provided it is relevant enough.

One product of effective performance measurement is the emphasis on terms that denote an information search close to the point of purchase. The most competitive terms are those that indicate a pre-purchase search. With the exception of a few groups of generic terms, this mindset has left the research and discovery keywords in most markets ignored and possibly undervalued.

Adcenter and Yahoo! Search Marketing

The merging of two Pay Per Click market places will increase internal competition. With more participants in the market and a reduction in available inventory, the cost of traffic will increase. Account management will be more efficient with this consolidation, and the volume of available traffic will increase too.

However, we won’t see this locally, as bidding for Australian traffic through Bing and Yahoo! is done via Yahoo! Search Marketing (Formally Overture, formally Goto, etc). What we will get instead, based on information to date, is an eventual change in the platform we use.

Why People will care more about rank in Bing

With Microsoft powering Yahoo!’s search results a good rank in Bing will mean even more traffic. Most decisions on how to allocate SEO resources are influenced by reported search queries and Google’s domminance within this metric. As a result, a lot of SEO activity online is focused on building for Google. It is seen as the only engine worth building for, as it will return the most for the investment of resources. With a ranking in Bing about to appear for more queries, and the deal generating more awareness, this may drive more interest and activity.

Still more to come

There has been a lot written, and some very in-depth, on this deal over the last week. There are going to be even more blog posts and press releases to follow. The fate of Yahoo!’s other search products has not been revealed yet, and there are other areas that still need to be clarified. One thing that can be taken for granted now is that a lot of people are going to be auditing the size of their brand and industry’s query space, and the rankings of their sites in Bing.

Interest in Bing

On another domain I have noticed that terms related to Bing and Bing.com.au have produced a little traffic. This is only to be expected due to the increased interest in the search engine.

SERP reshuffle

One thing that I noticed that is worth watching are changes in the order of sites on the Search Engine Results Pages. For a few of the terms that I have been watching, the top three or four results have remained fairly fixed since lauch. However there has been a bit of movement amoungst the mid-page results. This was even evident on terms where the level of SEO activity can be assumed to be low, and with static sites.

Bing and the Search takeaway

It is simple; there is a lot to be learned right now in how the Search Engine Results Pages have been changing for low competition terms. For now, the changes on these kinds of SERPs are more likely the result of spider and algorithmic activity rather than general updates or targeted optimisation.