Ballmer: Microsoft's behind Google in ads, search

ORLANDO, Fla.--Microsoft Chief Executive Steve Ballmer says the software giant has a long way to go to compete with Google, when it comes to search and advertising.

Microsoft is attempting to break into online advertising, but Ballmer admitted at the Gartner Symposium/ITxpo here Wednesday that Microsoft is still an "aspirant" in the search and advertising fields.

"In world search and advertising, Google is the leader; we're an aspirant," Ballmer said. "We have a lot of work to do in search and advertising."

Microsoft acquired digital-advertising company Aquantive in May, and it has been in the process of investing $2 billion in its own online-advertising platform.

Video: Microsoft's post-Gates plan
Steve Ballmer talks about filling the gap and sharing the leadership role after Chairman Bill Gates transitions away from his day-to-day duties next year.

Ballmer said it is "expensive to do an advertising platform," but he insisted that Microsoft's platform, Microsoft Digital Advertising Solutions, is viable.

"Our advertising system works," Ballmer said. "When we have something there, we'll show you."

The Microsoft chief said the company had evolved from a desktop software enterprise to a business that had "broadened" to include advertising and online services, as well as being an entertainment and mobile-device company.

Ballmer added that Microsoft's "software model is under attack...We need to take control back."

Aquantive itself still needs to use an external advertising agency as consultants, Ballmer admitted. "(Aquantive has) learned a lot from having an advertising agency feeding back," the chief executive said.

Gartner analyst David Smith said Microsoft was "clearly going after the online-advertising market, and advertising is Google's core market."

Smith said the slowing of the software industry's growth "is a challenge to Microsoft," hence its need to diversify into other sectors of the IT industry.

"Open source is putting a lot of pressure on pure-software companies," Smith said. "Microsoft doesn't have presence in other business--it needs pressure in the advertising market."

Tom Espiner of ZDNet UK reported from Orlando, Fla.

[gsmiller88]

Yea it works...

...But not as good as Google ;)

[rcrusoe]

or Yahoo, or Baidu

MS search is a solid 4th in the world.<br /><br />But after using it for a while, I'm surprised it's ranked that high.

[there can be only one]

Face it, Monkey-boy

He always talks a tough fight, but is all bark. You can't have <br />confidence in anything Ballmer says. What a boob. Hey, Ballmer! <br />Your kids still forbidden to have anything but Zunes in their <br />household? They must feel like the school morons, with the 'Softie <br />community disappearing once they step outside...

[dscottbuch]

Doesn't have a clue

This statement really show how out of touch he is.<br /><br />'Ballmer added that Microsoft's "software model is under <br />attack...We need to take control back."'<br /><br />They don't need to 'take control back' (they can't) they need to <br />adapt (they won't under Ballmer)

[jtjt145]

Ballmers time is up

Admittedly his engaging speeches are always good for a laugh. Though, I doubt he is aware its not always his jokes the audience are laughing about.<br /><br />He palavers in public of him power sharing with others in a Microsoft future after Bill Gates.<br /><br />What we are seeing is a corporate dinosaur in action ignoring the subtle signs that his time is up.<br />His enemies in his own company are are sharpening their knives and closing ranks, and Stevie does not even know it yet.<br /><br />Let him dream on, happily 'squirting' songs on his Zune against an ignorant audience.<br /><br />One thing is sure, though: The knives are out!<br /><br />Ian Fielders

[coryschulz]

It's true

He just talks and blows some smoke about Microsoft catching up and still being competitive, but the truth is they've fallen behind and are falling even more behind and have no real plans to save themselves. Sad I suppose, except they deserve it. Linspire looks good, and Apple is in one of the best positions it's ever been in. Vista is junk and so are the Zunes. The only real thing they have going is MS Office and the Xbox, which even then the Wii is outselling them.

[ServedUp]

Ballmer could be onto something BIG..

actually no he isn't. I'm only kidding.<br /><br />But its funny that he talks about Windows as still being <br />Microsoft's core product, when they haven't really paid much <br />attention to it in the last five years. <br /><br />Yes, five years is a very long time for a core product to be <br />produced and you would expect it to be nothing short of <br />AMAZING, but instead its just a repackaged version of XP which <br />is, all it really is.<br /><br />Does anybody no when Windows Singularity is coming out? Its <br />supposed to be all the buzz..

[coryschulz]

Singularity!

I've watched all of the videos about this on MSDN Channel 9, but they haven't released anything recent on it. I'm sure they have a GUI and and going by now and a whole bunch of other things. This entirely is MS's next OS. I wish they'd talk about it more. If they were smart they'd pump tons of $$ into this.

[m.meister]

Clear example of MS problems

Instead of listening to the mom's problems with Vista and trying to <br />understand the problem, Steve Ballmer was *trying* to show wit.<br /><br />He just comes off as an arrogant jackass that doesn't listen to or <br />care about his customers.

[Sumatra-Bosch]

NEWS: Ballmer Finds His Face Using His Own Hands !

I knew we were in the presence of a genius when he did his disco sieg heiling routine years ago. But this interview really cements his legend.

[rcrusoe]

evolved from a desktop software enterprise?

Really? How much money has MS made from everything they do except Windows and Office? So far, IMO, MS is still a "two trick pony". <br /><br />A ridiculously profitable two trick pony, for sure. But one that has yet to prove they can make money on a level playing field.

[Jim Harmon]

Why doesn't MS...

... just buy Google?? :)