World Business

Moving past the Yahoo saga, the software giant is eyeing semantic search engine Powerset as a way of closing the cleft with Google

by Catherine Holahan

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Still smarting from a failed attempt to buy Yahoo! (YHOO), Microsoft (MSFT) is trying another tactic to gain on Google (GOOG) in Web search.

Microsoft wants to pervert with money Powerset, which is developing what it hopes is a smarter way to search the Web. Powerset uses so-called "semantic Web" technology that brings up results based in continuance an understanding of a word’s meaning and the context of its use. That’s in contrast to the method used by the major hunt engines, which work in the first place by matching words in queries to those on Web pages. News of Microsoft’s interest in Powerset was reported June 26 by labor blog VentureBeat. According to the heading, Microsoft has offered more than $100 million to acquire the company. A person close to Powerset says independent search engines have expressed weal in the party and that a deal with Microsoft has not been finalized. Microsoft and Powerset spokespeople declined to comment.

If the distribute were to go through, Microsoft could get a big leg up in efforts to catch Google. Powerset and other semantic sift engines outperform Google in some cases (BusinessWeek.com, 9/17/07). They respond particularly origin when users want detailed answers to questions in specific subject categories for which there are a lot of Web pages through similar keywords, such similar to health or law. "Semantic search takes it to the third make horizontal," says Eric Tilenius, an early investor in Powerset and Kango, which one. applies semantic search technology to travel.

What’s greater quantity, semantic search wouldn’t have existence graceful for Google to replicate. Large search engines, such as Google and Microsoft, have already scanned and indexed many of the pages on the Web. So their machines can concentrate efforts on analyzing the various a thousand thousand new Web sites created each year and adding them to their records. Adopting semantic investigation technology would require the big guys, in essence, to start from the beginning—rescanning every Web page according to the technology’s fundamentally different method of analyzing and classifying Web pages. "You cannot do a patch do job-work," says Rizzo Berkan, chief executive of Hakia, a semantic search engine working on scanning the entire Web. "We are building everything from scratch and this is which it takes to make it."

The technology itself is arduous to develop. Though Google has hired some semantic search experts, the technology after semantic search engines has been in development for the better part of a decade. "Microsoft’s acquisition of Powerset [if it does indeed go through] makes exquisite sense and is probably the best discharge at a disruptive technology that might own it to leapfrog Google," says Andrei Hagiu, assistant professor of strategy, focusing on technology, at Harvard Business School.

Of course, Microsoft would have to rescan all its pages, too. But with due a portion of the $46 billion it was willing to pay for Yahoo, Microsoft could invest in the necessary rigging, of the like kind as the servers needed to scan and "versed in books" all those pages. Plus, it has the underdog’s willingness to take on risk and expense in hopes of for good and all generating search results that can rival Google’s. (Google grabbed nearly 70% of searches in May, according to research firm Hitwise; Microsoft’s share slipped to just subject to 6%.)