David Coursey | Friday, October 02, 2009 7:35 AM PDT

Tech Inciter– PC WORLD

OK, so after the hoopla, Microsoft‘s Bing search engine may have fallen back to earth. Is Microsoft supposed to just give up? Not hardly.

New statistics show Microsoft’s share of searches is down below 4 percent, having risen during the previous three months. Google, meanwhile, captures 90 percent of search traffic.

I am not sure I totally believe these newest statistics, from NetApplications and StatCounter. Nielsen’s numbers are quite different, as are Comscore’s — both giving Bing a much larger share of the search pie. Let’s give it a month or two before declaring Bing’s honeymoon to be over.

Bing was introduced in May as the successor to Microsoft’s previous search engines.

Microsoft continues to spend heavily on search technology research and development. Bing is only the tip of the iceberg, though progress is slow because search is such a huge problem. Anything you develop that improves search must be almost infinitely scalable and able to be offered for free.

That’s a pretty tall order. You need innovation in all areas, including the business plan, to take search to the next level.

Bing is an example of what I call a “demographic” search engine, tailored not to be all things to all searchers, as is Google, but to attract a defined audience. In Bing’s case, that means shoppers.

I believe but cannot prove that Bing may generate more revenue per search (in terms of customer spending as a result of searching) than Google. Even if that were true, however, it would only dilute Google’s leadership by just a smidge.

The Yahoo/Microsoft deal, should it pass regulatory muster–and it deserves to–will help Bing’s share, but won’t do much to reduce Google’s numbers.

While Google is today, for most people, the first word in search, I don’t think it’s the last word. Even with ongoing changes to improve accuracy and make results easier to manipulate and digest, Google searches still return way too much of what I don’t want.

If it takes looking through three pages of results to find what I wanted, Google has failed me. I know I am expecting Google to be psychic–essentially to understand what I want even when I have a hard time explaining it–but with all Google knows about me, it doesn’t seem like an unreasonable request.

Maybe Google will meet this challenge. Maybe it will be Microsoft. The betting favors Google, but you never know what will happen. The Netflix prizewinners are examples of what can be done to match users with improved search results.

Bing is wise to follow its current course. It will probably never challenge Google in overall numbers, but it could easily find a place in the market as the search engine that does specific things better than Google and generates traffic as a result.

It is too early to judge Bing’s success or failure. Its share drop was to be expected. Its progress will be slow. But, it is still a player and should Microsoft’s R&D create a breakthrough, Bing will be there to launch it.

David Coursey tweets as @techinciter and can be contacted via his Web page.