Microsoft Presses On With Kumo Search Plans

Some secrets are hard to keep.

Microsoft is beginning internal testing of a major upgrade to its search engine this week, putting the rebranded version of Live Search -- the long-anticipated Kumo -- through its paces behind a corporate firewall.

The company's executives have made no secret of their commitment to staying in the search game, but details of the Kumo trail began to percolate on the Web following a Twitter post from Microsoft (NASDAQ: MSFT) search strategist Barney Pell mentioning the rebranding. Pell came to Microsoft in last year's acquisition of PowerSet, the semantic search company he cofounded.

Pell has since taken down the tweet, but the Seattle Post-Intelligencer has the screen shot.

Many analysts and bloggers have questioned the wisdom of Microsoft staying in the search business, which continues to be a money loser for the company.

In a recent presentation to financial analysts, CEO Steve Ballmer defended the company's decision to stay in the search business, despite the Microsoft's position as a distant No. 3 behind Google (NASDAQ: GOOG) and Yahoo (NASDAQ: YHOO).

"Some people say to me, 'Why don't you just give up?' You can't give up," Ballmer said. "We have good ideas."

But search is not a quick ship to turn, he admitted. "This is not going to change quickly."

According to the most recent figures from online metrics firm comScore, Microsoft performed 8.3 percent of all search queries in January, compared to Yahoo's 20.5 percent and runaway leader Google, which accounted for 63.5 percent of search engine activity.

Ballmer and other Microsoft executives have repeatedly said that some form of a search partnership with Yahoo makes the most sense for both companies in their efforts to gain market share from Google.

Those deal talks, the great acquisition drama of 2008, of course never came to fruition. Ballmer has said he remains hopeful that the two companies will be able to come together once Yahoo emerges from its reorganization under new CEO Carol Bartz.

[cob:Special_Report]But Microsoft takes pains to let the world know that its future in search is not staked around a Yahoo deal.

Kumo, the long-anticipated successor to Microsoft's vaguely branded Live Search, appears to pepper in some semantic upgrades to its search listings. Screen shots of sample searches floating around the Web indicate show a column pane on the left side displaying related searches and a search history.

In other shots, Kumo organizes results by category, so a search for a stereo would turn up one section for Web-wide results, then separate sections for reviews, prices and how-to manuals.

According to a leaked memo, Microsoft will begin automatically redirecting employees' Live searches to Kumo.com for the testing.