Microsoft unveils Bing search engine

New search engine will replace Live Search on June 3, and will offer search by groups and categories rather than straight links.

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By David Goldman, CNNMoney.com staff writer

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NEW YORK (CNNMoney.com) -- Microsoft Corp. on Thursday offered Internet users a first glimpse at Bing, its fresh attempt to gain ground in the online search market.

Bing is a search engine to replace its current Live Search product. Microsoft hopes it will provide users with a more streamlined, focused approach to search. Bing is set to launch on June 3.

Microsoft's search market share has been slipping for more than two years, and it has struggled to make its online advertising unit profitable. The company maintains just an 8.2% share of the market for core searches, according to comScore, compared to 64.2% for Google (GOOG, Fortune 500) and 20.4% for Yahoo (YHOO, Fortune 500).

Microsoft CEO Steve Ballmer demonstrated Bing Thursday at the All Things Digital conference in Carlsbad, Calif. The new search engine will help users refine their queries and initially offer four different categories of search: purchases, travel, health and local businesses.

"Today, search engines do a decent job of helping people navigate the Web and find information, but they don't do a very good job of enabling people to use the information they find," said Ballmer in a statement. "Bing [will] enable people to find information quickly and use the information they've found to accomplish tasks and make smart decisions."

In addition to offering search by category, Bing will offer more relevant search results, snapshots of search results' Web pages, color-coded search results and search tools on the left side of the page, according to Microsoft.

Bing is also set up to organize search results in relevant groups rather than as a series of links. For instance, a search for "fly to New York," may yield New York destinations like hotels, restaurants and museums as almost a guidebook page. The same search on Live.com generates straight individual links that users have to go through one by one.

Sandeep Aggarwal, senior Internet research analyst with Collins Stewart LLC, said Bing may have chance at becoming a "destination" Web site like Google, because the site's technology has been better tested.

"Live wasn't ready for prime time because the technology was too premature" and users weren't repeat customers, he said. "Now Microsoft thinks they're ready."

Microsoft has looked for ways to improve its search advertising revenue for years, including offering rival Yahoo a more than $47 billion takeover bid early last year.

Though that deal fell through, the companies have been in and out of discussions about a potential search tie-up since last May.

On Wednesday, Yahoo Chief Executive Carol Bartz told attendees at the All Things Digital conference that talks between the two companies have continued "a little bit," but no agreement has been reached.

Aggarwal said he expects a Microsoft-Yahoo search deal to be reached by the time the companies report their quarterly results in late July.

Shares of Microsoft (MSFT, Fortune 500) rose 2% in afternoon trading. To top of page

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