A year after Microsoft launched Bing, the product has returned Microsoft to credibility in the search market, and appears to have prompted renewed innovation at Google.
Microsoft took the wraps off the Bing search engine on May 28, 2009, letting it finally replace the far-from-beloved Microsoft Live Search.
Bing was seen as the firing of a shot across the bow of Microsoft's increasingly successful rival Google, which made its name - and most of its fortune - on the back its search engine.
So far, analysts say, Microsoft has been able to stabilize its position in the all-important search business, and appears to have pushed Google engineers to boost the capabilities of its engine.
"Bing had a good first year -- not a breakout performance, but it has succeeded in returning Microsoft to credibility in the Web search arena. That's a huge step forward," said Hadley Reynolds, an analyst at IDC.
"The competition from Bing has certainly had an effect on Google's pace of innovation," he added. "Google has made more visible changes in the past six months than in the several preceding years."
Industry watchers have maintained that the pickup in online search development over the past six months could very well change the face of search all together.
Both Microsoft and Google have integrated real-time search results into their respective engines, allowing users who query a topic to get results, including Twitter posts, that are only a few seconds old.
The Google innovations included Google Goggles, a photo-based search tool. Google also added a new left rail on the search results page offering users query refinement options and navigation aides. The latter features were part of Bing at its launch, noted Reynolds.
Meanwhile, a follow-up version of Bing added a feature-rich Bing Maps update had some industry watchers saying that Microsoft may have bested Google Maps.
Rob Enderle, an analyst with the Enderle Group, said that while Google definitely sees Bing as a worthy contender, Microsoft's hasn't yet noticeably improved its share of the search market.
Early last month, Hitwise, an online traffic monitor, reported that despite the competition from Bing, users turned to Google for more than 71% of all searches in the U.S. in April, 2% more than the previous month. By contrast, Bing was used for 9.43% of searches for the month, 2% less than in March.
Bing had made strong gains in market share in the first months following its release, but by early this year had lost some momentum and saw its numbers start to hold steady or even slip.
Enderle noted that people are simply accustomed to using Google for searches, and that they will need a strong reason to switch engines.
"Bing has done reasonably well, given that Google is entrenched and customers are relatively satisfied," Enderle said. "They did better than any of the other challengers and gave Google a wake-up call. However, Google is hardly weakened -- Bing still needs to up their game."
Dan Olds, an analyst with Gabriel Consulting Group, said Bing's biggest challenge is overcoming Google's place as an embedded piece of online culture.
"Bing started out strong with a highly publicized introduction, which may have raised hopes that they'd make a bigger dent in Google's share," said Olds. "However, after the hoopla, the war has settled into trench warfare with small gains and losses on each side. Still Bing hasn't had bad results for only a year out and about as good as can be expected against a dominant and smart competitor like Google."
What could put a new spin on the picture is the fact that Microsoft and Yahoo have decided to combine their search businesses.
The two companies last summer announced plans to have Microsoft's Bing search engine power Yahoo's Web sites, while Yahoo sells premium search advertising services for both companies.
The Microsoft-Yahoo deal has since gained regulatory approval, and a joint engineering team was created to work on adapting Bing for the Yahoo site.
Both companies have said they hope the Bing engine is added to the Yahoo site, at least the United States, by the end of this year.
"The Microsoft and Yahoo partnership is almost certainly going to have an impact on Google and its strategy," said Olds. "The battle will be different. The two companies are a threat to Google now because they have staying power. They're not startups or dabblers. They're in it for the long haul now -- fully committed and willing to invest whatever it takes."
Sharon Gaudin covers the Internet and Web 2.0, emerging technologies, and desktop and laptop chips for Computerworld. Follow Sharon on Twitter at @sgaudin, or subscribe to Sharon's RSS feed . Her e-mail address is firstname.lastname@example.org.