This tidbit comes courtesy of app developers, who of course are now able to play with the preview of iOS 7 ahead of its consumer launch later this year. A Yandex spokesman subsequently confirmed the inclusion to me.

Here are tweets from devs in Russia:

Яндекс в iOS7 http://t.co/wnJMn2bqWr—
ʎɐsʇɐd ʎdɯnɹƃ (@alexmak) June 11, 2013

… And Turkey:

iOS 7 supports yandex search on Safari

@YandexComTr @yandex @YandexDestek http://t.co/0zCwTU5Oj2—
Bahaeddin Nakiboglu (@bahaeddin) June 10, 2013

Turkey is a particularly big win for Yandex, which is pushing hard into that country. As for the company’s more traditional markets, the inclusion of Yandex search as an option in Safari could even be seen as belated – the company has a majority share of the Russian search market, and a few months ago it even ranked higher than Microsoft’s Bing for numbers of searches on a global basis.

Yandex has already been supplying data for local users of Apple Maps since September last year.

Around the world, Google is the default search option for Apple’s customers. Bing and Yahoo are also global options. Not many local players get to join that list – although China’s Baidu is a notable exception in that country.

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Here are some veiled semi-, sort-of predictions Sherlund put down in a research note released very early Tuesday morning:

1: Restive shareholders gain power: Sherlund thinks that shareholders are gaining steam in their  demand for a greater voice in the company’s strategic direction.  There “may be a more receptive group of frustrated shareholders to leverage in an effort to drive greater realization of shareholder value at Microsoft,” he wrote.

2: Microsoft could exit search. It could hand search off to Facebook or Yahoo in return for traffic acquisition costs, Sherlund wrote.  Microsoft Bing has gained some ground on Google but remains a distant second. The latest Comscore numbers  showed Bing with a record 17.1 percent of U.S. searches in April, up from 16.9 percent in March. Google share fell from 67.1 percent to 66.5  percent over the same period. Whether Microsoft’s gain is worth what the company spent on its BingitOn campaign, is subject to debate, however.

3: It could (gasp!) dump Xbox Sherlund acknowledges that we like to play Xbox but “it doesn’t seem like a good enough business for Microsoft to focus on.” He goes on to explain that at one point it was critical for Microsoft to “own the consumer connection to the internet” i.e. the console but as cool as it is, it’s not material to Microsoft’s broader business. More importantly, he thinks that someone, say Samsung, might pay a couple billion dollars for that business.

One thing is clear: Microsoft shareholders are one unhappy bunch. Looking at the post bubble-burst over the last 13 years, the stock price is basically flat — it’s peaked at around $37 and has bounced between that and $20 for much of that time.

That’s led to some very loud calls for CEO Steve Ballmer to head for the door — something Ballmer shows no intention of doing. Dow Jones Newswire’s  Al Smith helpfully published Ballmer’s Epitaph earlier this month, citing Windows 8 as a “bet the farm” gamble that didn’t pay off. The contention that Windows 8 is a failure has been repeated in several news outlets and is something Microsoft’s top corp comms guy couldn’t let pass. In a blog post, Frank Shaw responded that Windows 8, which has sold 100 million copies, is hardly a failure. And linked to two positive reviews.

But back to Sherlund. He senses something different in the air when it comes to Microsoft’s corporate governance:

“We think there is a shift in the wind upcoming for Microsoft,with shareholders likely demanding a greater say in the direction of the company and how it might be run to drive a better return to shareholders.”

Now we’ll just have to wait and see.

MSFT data by YCharts

This story was updated at 10:41 a.m. PDT May 28, 2013 to add comments around Microsoft’s Xbox business.

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In an earlier post, I explained how the company is betting on its investment in machine learning and the webscale infrastructure that powers its Bing search engine to fuel its future devices and services. When you consider that any sort of gesture, speech or handwriting-recognition technology incorporates machine learning in order to decipher what human beings are actually doing, saying or writing, it’s easy to see how busy Microsoft has been.

Some of the technology was downright impressive if not occasionally mind-blowing (in theory, at least), while other parts — particularly some of the futuristic tableaus involving hyper-interactivity — seem, frankly, a little annoying. (You can see some examples in the gallery below.)

Showing off: Consumer tech

Microsoft used its TechForum media event to show everything from a speech-recognizing, dual-screen Xbox Live interface (and to hint at forthcoming original, possibly interactive programming from Microsoft) to a research project that allows Kinect to recognize hand gestures in addition to broad movements. The latter would allow for new ways of controlling Kinect-connected devices without controllers or specialized gear (e.g., fake guns) because a gripping (and releasing) motion would replace the press of a button.

Rick Rashid, Microsoft’s chief research officer, said the company used Kinect to teach an elevator in one building when people are planning to board or just standing in front of it conversing. If the elevator senses that someone wants to get on, the door opens automatically without requiring the person to press a button.

And, of course, pretty much all of Bing is the result of machine learning and big data technologies. Qi Lu, president of the Online Services Division, showed off all sorts of Bing capabilities, including one that surfaces reviews or other information from respected voices in the specific fields about which a user is searching. He said that capability requires searching “trillions of pieces of web data” to determine who’s influential and whether their content is of high quality.

The whole event took place in Microsoft’s new Envisioning Center, which tries to simulate what our work and home lives will be like a decade or more out. What’s Microsoft’s vision? Everything — from the LED bulbs to the omnipresent screens to the stove burners — is digital, connected and equipped with sensors, and 3-D printers sit on every desk. It’s everything the 8 million apps we have today are trying to be, only, well, convenient.

Showing off: Enterprise tech

For the business users, Microsoft demonstrated the machine-learning-based Flash Fill feature in Excel 2013, as well as a research project for indexing structured data sets available on Bing and then having Excel automatically recommend them based on the data someone is already working with. PowerPivot, a BI extension for Excel, can now handle 100 million rows of data in-memory versus its old limit of 1 million rows — allowing users to prove models before deploying on a larger scale using SQL Server and new performance-boosting in-memory, columnar store and compression capabilities.

Microsoft is also working on a workspace environment called DataLab that lets users share data, models, experiments and workflows. Technical Fellow Dave Campbell said the goal is to reduce the need for armies of skilled data experts by letting them publish their work for broader consumption — just like what happened with applications years ago. Some of these — such as Microsoft’s own Synonyms Search tool for figuring out what search terms are often associated with each other — will eventually make their way into the Windows Azure Data Marketplace.

We also saw research projects focused on using machine learning to identify in real time faulty microchip wafers (or, in theory, anything) as they traverse the production line and an application that analyzes petabytes of web data in order to determine how viral content spreads across the web. At Microsoft TechFest event the following day (which I didn’t attend), the company apparently showed off even more research projects in this same vein of fancy visualization and interfaces belying some serious data processing.

On the collaboration front, Microsoft trotted out its Lync video-conferencing platform that also lets users collaborate on documents use virtual ink to write messages. The latter appears particularly useful for creating virtual whiteboards, especially when Perceptive Pixel screens are involved. When the meeting is done, Office Division President Kurt DelBene said, everything saves to the cloud and can be shared with whoever needs it.

If I had one takeaway from TechForum, it’s that I wouldn’t want to be any legacy technology company right now — be it HP, IBM, Sony, Dell or even Apple — trying to ride a skyrocketing innovation curve while also having to maintain a multibillion-dollar collection of legacy businesses. Gun to my head, though, Microsoft wouldn’t be a bad choice.

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I would have been surprised had I not sat down with Microsoft Technical Fellow Dave Campbell the night before the event to talk big data. After all, I was in Redmond — home of Word, Excel and a, shall we say, misunderstood new operating system — not Silicon Valley, where “machine learning” now rolls off the tongue as easily and often as “startup” or “triathlon.”

However, a single rhetorical question from Campbell resonated pretty loudly and got me in the right frame of mind for what I was about to hear: Who else, he asked, has a top-tier web service business (complete with the hundreds of petabytes of data those services collect) as well as a top-tier enterprise software business?

He could have added to that list a consumer software business, 30 percent of the world’s long-distance calls, a mobile device business, one of the world’s most popular gaming platforms, a large-screen touch-display business, and a motion-sensing device that ties into — and can control — all of them. They all came into play at TechForum, as various company presidents, engineers and now-adviser-to-the-CEO Craig Mundie demonstrated a future where everything is connected and trying to learn what we like and what we’re doing.

Bing is the key to it all (even if it can’t touch Google)

Microsoft’s Bing search engine is at the core of everything the company is trying to do in the field of machine learning and cutting-edge big data. That fact makes it an important part of Microsoft’s future even if it never gets close to Google search in terms of revenue or users. “Its long-term value is just as much as a deep infrastructural element,” Mundie said during a Q&A session kicking off the event.

What he means is that Bing is valuable because the technology developed to power it ultimately stands to make Microsoft a lot more money in other areas. Qi Lu, Microsoft’s Online Services Division president (and an integral part of the maturation of Hadoop inside Yahoo earlier this century), describes Bing’s primary architecture as less of a traditional keyword index and more of an “information fabric.” We’re building a digital society, he explained, so there are digital entities — people, place and things — and Bing must be able to capture the rich spatial, temporal and other relationships among them.

A research project for analyzing viral web content.

Taking that vision company-wide, Microsoft can take in data from Bing, Skype, Xbox Live, Office 365 and other sources and actually be able to store, process and analyze it in a meaningful ways. Internally, this might be for business-intelligence or product-development purposes. Externally, Microsoft might use data to create experiences that span devices and services.

Bing also feeds the pipeline for future enterprise IT products, particularly when it comes to data management. Campbell tells the story of meeting a colleague years after he left the SQL database team and went to work on Bing’s infrastructure. At that point, their worlds were vastly different, but the advent of and hype around big data has converged them once again.

Satya Nadella at Structure 2012
(c) Pinar Ozger

During his presentation, Satya Nadella, Microsoft’s Server and Tools Business president, said the company now builds internal IT with a design-for-first-party-but-think-of-third-party mentality. As a result, the core of the Windows Azure cloud-computing platform is based on technologies developed to run Bing, as is the Windows Azure storage service. When Microsoft builds a new operating system, he added, it thinks about the project at webscale in terms of what it would take to run Bing using that platform.

And Campbell told me via email after the event that Microsoft is considering how to productize the various graph, NoSQL and other types of databases it uses to power the features within Bing. Ironically, though, its Cosmos and Dryad technologies that serve as the core of Bing are off the table: consumers demanded Hadoop, so that’s what Microsoft is currently pushing for mass storage and large-scale batch processing.

Google, of course, is doing something very similar, albeit with less of a focus on enterprise software as a final destination for its technologies (with the exception of its small suite of cloud services such as Compute Engine, App Engine and BigQuery). Rather, the types of advances in data storage, processing and analysis that Google has made thanks to products such as search and YouTube are finding their way into Project Glass and self-driving cars. Time will tell whose efforts prove wiser in the end.

A little history and prognostication on machine learning

Mundie said machine learning, especially, has been a core part of Microsoft Research’s focus for years. And although there were some initial struggles, including a dearth of good data and machines powerful enough to process it all, the company and the industry as a whole have come a long way. Among the big areas of improvement he cited were real-time speech recognition — Microsoft has done some impressive work in this area, actually — and natural user interaction.

“We’ve talked for a long time in the industry about IT meaning information technology,” Mundie said, “… you might redefine IT to be intelligent technology.”

Eric Rudder, Mundie’s protégé and chief technical strategy officer, elaborated. If you think about all the pictures and other info Microsoft’s devices and services capture, he said, you’ll see a lot of opportunity to learn and build better products. Stepping out of the consumer world, he questioned how one might begin working with a 40-billion-row Excel spreadsheet. Query it, talk to it or somehow use gestures to communicate with it?

Eric Rudder (foreground) and Craig Mundie (background). Source: Microsoft

Mundie thinks Microsoft can answer these and other questions — this despite a relative lack of attention compared with Google’s research efforts and a consumer community he says is “jaded” by the omnipresence of high technology. TV makers are copying Kinect, speech will be the most-prevalent user interaction and cameras as inputs are coming soon, he said. And Microsoft’s machine-learning research will let it capitalize or even lead the way on these movements, he added.

As I’ll highlight in a follow-up post, Microsoft showed off a lot of these capabilities to the handful of journalists invited to TechForum. Kinect, Office, Xbox Live — they’re all watching, listening, learning and working together.

It’s part of a greater transition away from “specialized gadgets” that process information and into a world full of generally intelligent devices and services that just let people get stuff done. “The vast majority of humankind,” Mundie said, “doesn’t really care about the computer, per se.”

Have research division, will persevere

In the end, Microsoft Chief Research Officer Rick Rashid expects Microsoft’s heavy investment into general research of the kind his team does will help it get the last laugh over some of its competitors. He wonders whether companies like Apple — which already saved itself once — will be ready to ride the next wave of innovation or the one after that without dedicated general research departments that aren’t necessarily tied to product development. His view is that you can only buy yourself into the next generation so many times.

A project (same as the feature image) called Adaptive Machine Learning for Real-Time Streaming.

It was Microsoft Research, for example, that developed a method for compressing 32-bit code in the early 1990s — something that would prove fortuitous when it came time to ship Windows ’95 and its associated applications despite the fact that most PCs lacked the proper hardware for the 32-bit OS. In terms of establishing the dominance of Office over its peers that had to wait until the hardware caught up, Rashid told a group of reporters during the event, “that was game over.”

“Our industry is littered with companies that aren’t here anymore,” he added.

Touché. Microsoft is the butt of a lot of jokes, but as the tech world shifts toward intelligent devices and alternative mode of human-computer interaction, the company’s research into areas such as big data and machine learning suggest it will still be very much around for some time to come.

To learn a lot more about machine learning and the latest trends in big data technologies, be sure to attend our Structure: Data conference March 20-21 in New York. Speakers will include some of the brightest minds in data from organizations such as EMC, Facebook, Cloudera, Quid and even the CIA.

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That’s the idea behind its new Adwords Enhanced Campaigns, according to a Google blog post. The unstated rationale is that click rates for mobile ads aren’t exactly setting the world on fire. Google, like Facebook, has a mobile problem. It needs people to click on the ads on their phones and tablets and it needs to find a way to wring more dough out of each click.

Here’s the example Google uses:

“A breakfast cafe wants to reach people nearby searching for “coffee” or “breakfast” on a smartphone. Using bid adjustments, with three simple entries, they can bid 25% higher for people searching a half-mile away, 20% lower for searches after 11am, and 50% higher for searches on smartphones. These bid adjustments can apply to all ads and all keywords in one single campaign.”

According to the Google blog:

“With enhanced campaigns, instead of having to cobble together and compare several separate campaigns, reports and ad extensions to do this, the pizza restaurant can easily manage all of this in one single place. Enhanced campaigns help you reach people with the right ads, based on their context like location, time of day and device type, across all devices without having to set up and manage several separate campaigns.”

Folks had been expecting Google to change its Adwords strategy. Richard Zwicky, CEO of Blueglass, a digital marketing agency and software provider predicted the change and is not a fan.

In his blog, Zwicky wrote that “less complicated campaign management means less campaigns to manage, which is simpler, but also will likely result in lower ROI for advertisers whose campaign managers now need to restructure every campaign they run to adjust for the new reality.”

In his view these changes don’t make things less complicated, just different and “less transparent.” Bottom line, this isn’t good for anyone but Google, according to ZDNet’s Larry Dignam. More on the news from SearchEngineLand.

In other news, Yahoo said it signed a deal with Google to display ads on Yahoo properties using Google’s AdSense for Content and Google’s AdMob services. “By adding Google to our list of world-class contextual ads partners, we’ll be able to expand our network, which means we can serve users with ads that are even more meaningful,” according to a Yahoo statement.

While this is a nonexclusive agreement, Yahoo watchers expect there could be more collaboration with Google since former Google exec Marissa Mayer took the reins as Yahoo CEO. Yahoo is reportedly not happy with the results of its partnership with Microsoft  which made Bing the search engine for Yahoo.com. Gee, I wonder what other search engine they could use?

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Microsoft, which spent billions on Bing to compete with Google search, is clearly chagrined at this ruling as general counsel Dave Heiner wrote in a Technet post on Thursday.

But the bulk of the comments to that post — actually all of them right now — show zero sympathy for Microsoft which has faced its own share of complaints over its business practices in the past. In 1999, it was actually ruled a monopoly by a federal judge although that decision was overturned two years later.

A sampling of the Technet comments:

“Apple litigates, Google innovates, Microsoft whines.”

“Microsoft’s whining about Google’s abuse of patents or monopoly in general is a pinnacle of hypocrisy. May be you first should look at your own abuses in the same areas?”

” … ‘Google continues to prevent Microsoft from offering a high-quality YouTube app for the Windows Phone.’ Is there a high-quality Microsoft Office app for Linux? iOS? Android? Office documents can’t even be opened on these OSes (yes, you can import them using other software, but that is a hit or a miss affair) At least Youtube is accesible [sic] through the mobile browser from Windows phone, and Microsoft is whining that a “high quality” app is not available…

“Why is there no ‘Share on Google+’ option from this page … You have every other option available -facebook, redit [sic] , linkedin etc….”

It almost makes you wonder if there’s an anti-Microsoft astroturf campaign going on — which might be poetic justice, given Microsoft’s use of such tactics in the past.

The thing that struck me most about this whole drama were the words used by FTC Chair John Leibowitz in response to complaints about the ruling. Quoting Supreme Court Justice Earl Warren, Leibowitz said antitrust laws exist to protect competition, not competitors.

Those were the exact same words Microsoft’s own PR people and lawyers uttered over and over again in its own antitrust battles of the 1990s.

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In a blog post announcing that Bing would become one of Klout’s “most significant partners,“ Klout CEO Joe Fernandez explained how the two will be a good fit:

Microsoft and Klout both believe that the growth of the social web and the increasing importance of your online identity are fundamentally transforming the Internet, making it even more important to understand people, not just pages. Like Microsoft, Klout is a friend to all social networks. We both want to help everyone discover relevant people regardless of the specific networks on which they’re active. And we believe we’ve only just begun to tap into the knowledge and insights “search through people” will enable, now and into the future.

While Bing has struggled to gain popularity as a search engine in the face of Google’s dominance, Klout has received a good deal of press and recognition recently, and its user stats might provided a needed boost for Bing’s results. Plenty of people are skeptical about Klout’s scoring of a person’s digital influence, but there’s certainly money to be made in finding rabid social media users and connecting them with brands.

Microsoft’s investment will bring a user’s Klout profile into search results on the site, and Bing will provide additional data to Klout. Klout recently revamped its scoring techniques for assigning each users a number, bringing a greater number of social media platforms and websites into account. So adding a person’s search results on Bing seems like a natural fit as the company expands its reach and desire to do “search through people.”

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Granted, this is kind of a “duh” story given the rivalry between Google and Microsoft, which wants to play David to Google in internet search. But it bears watching given that Google phenom Marissa Mayer is now CEO of Yahoo.  And, Microsoft and Yahoo’s Bing relationship has been rocky. As SearchEngineLand’s Danny Sullivan reported this summer, Microsoft has had difficulty meeting revenue guarantees under its three-year Bing deal with Yahoo.

Microsoft has been putting up a fight in search, pouring resources into Bing and even launching Bing It On, a Pepsi Challenge like consumer taste test of Bing vs. Google search. Microsoft claims Bing prevails in that contest by a 2 to 1 margin. Others report different results.

Feature photo courtesy of  Flickr user Guillaume Paumier

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In response to a question from TechCrunch founder Mike Arrington about whether the company plans to do anything in the search market, Zuckerberg said that the social network already handles about one billion search queries every day, “and we’re basically not even trying.” For comparison purposes, that’s about 20 times as many as Microsoft’s Bing search engine gets — and about a third of the 3 billion queries that Google handles every day. But it’s not just about volume: the critical factor is that Facebook’s searches are all about finding socially relevant information, from people to brands and related topics. As he put it:

“Search engines are really evolving towards giving you a set of answers… like, I have a specific question, answer this question for me. And when you think about it from that perspective, Facebook is pretty uniquely positioned to answer a lot of the questions that people have. That’s one obvious thing that would be interesting for us to do in the future.”

To give just one example, the Facebook CEO said a question might be something like: “What sushi restaurants have my friends gone to in New York, and liked?” This is the kind of answer that Google simply isn’t very good at providing — or at least, not yet. It can show you sushi restaurants within a few miles of your location, and it can show you ratings from Yelp and other services to help you choose, including reviews from its recently purchased review providers Zagat and Frommer’s, which are starting to show up in the “one box” results for restaurants. But it can’t really show you which ones your friends like, unless they all happen to be on Google+.

Google+ is no match for Facebook on social data

Coming up with that kind of socially-relevant data was the whole purpose behind the launch of Google+. It wasn’t that Google wanted to give people a place to share cat photos — it was a way of getting lots of people to create profiles and add friends and interests, and thereby generate a ton of data that would make it easier for the search giant to target advertising, and also help add social elements to its search results. The biggest problem with the “Search Plus Your World” feature is that it primarily shows you content from Google’s network, and whatever it can scrape together from the two networks that make up the bulk of people’s online social lives: Facebook and Twitter.

Like Facebook, Google knows that search is moving from keywords and links to providing answers for users to questions such as “Where should I eat?” and “Who can repair my car the best?” That’s why the company has been spending so much time and effort adding expert information from places like Wikipedia and from its own sources like Zagat. But that isn’t social data, and while there has been plenty of debate about the ultimate value of social recommendations, there’s no question that Facebook has a far better grasp of that than Google. And unless Facebook and Twitter choose to change their blockade of the search engine, it is likely to stay that way.

Re search: interesting part was he talked about true social search. Not forcing Google/Bing search box on people a la Myspace.

—
chris dixon (@cdixon) September 11, 2012

As venture investor (and eBay staffer) Chris Dixon pointed out in a tweet about Zuckerberg’s comments, the point of the Facebook CEO’s remarks wasn’t that the network plans to do search in the same way that we think of it now — by slapping a search box from Bing or Google on the page. Instead, it wants to provide a whole different aspect of search, one that is oriented around a user’s social graph and the connections between them. With close to a billion users, and more than five billion actions involving status updates and likes and all of the other activity that occurs on Facebook every day, that is a massive data set with which to triangulate a user’s interests.

Whether Facebook is going to be able to do this while it is also trying to advance a mobile strategy and reinvent advertising and all of the other things on its plate is an open question, and so is the effect that moving into the social-search arena would have on the company’s relationship with Microsoft, which provides its own social search via a partnership with the social network. But if anyone has the resources to reinvent search for the social age, it is pretty clearly Facebook — and that could be Google’s worst nightmare.

Post and thumbnail images courtesy of Flickr user Abysim

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