It’s all about timing. Bing’s inability to take market share from Google in the search industry and Facebook’s focus on improving their internal and external search abilities has made it seem to be a perfect match since the NY Times suggested the possibility last year. The timing simply hasn’t been right and the discussion hasn’t progressed beyond closed-door discussions.
When is the right time for this industry-changing event? Most would say that an infusion of cash and the risk of distraction makes it a deal that would best occur after they go public, but there are those who say that concerns over Facebook’s ability to grow and sustain revenues surrounding its “make money to build better services” philosophy would make the Bing purchase a booster to sentiment ahead of the IPO.
Internally, Facebook could make a ton of money by improving their site search and infusing ads into it. In February, Facebook users performed 336 million searches in February with a system that most agree is relatively worthless. They have a large team working to improve it. The question is: are they improving it so they don’t have to buy Bing or are they getting it ready to be able to integrate Bing?
For Microsoft’s part, it’s a question of business relevance versus pride. Whether they get a bigger chunk of the social network, cash, or (likely) a combination of the two, they will create a much stronger environment through which to focus on their software core, their focus on mobile, and the expanding battle they find themselves in with Google over enterprise solutions. Bing has not performed the way they had hoped after sinking millions into promoting it with limited yield.
While it’s still a longshot due to the shakeup that would occur, purchasing Bing give more control to Facebook over its own destiny. Search is a tricky business and with Bing’s attachment to floundering Yahoo, the risk of failure may simply be too high for a company that still has a huge upside.
If and when it does happen, there is a likely casualty as a result: the Facebook phone. Any plans on bringing out a Facebook-designed and powered smartphone would certainly have to run through Windows 8 or not at all.