I would think that MSN is now in the position to challenge Google and they are in much better shape now then they have been in awhile, at least in the search engine game. Plus they have a lot of money and maybe they aren’t done spending it.   Yahoo didn’t do that bad here because they have been overmatched and out of it for a long time and they knew it, the results at Yahoo organic suck and the Yahoo PPC program is weak.  So now they can focus on other things and in the long run it probably will be the end user and advertisers who come out ahead.

From Matt Cutts Blog:
Who did better in the Microsoft-Yahoo deal?

BACKGROUND ON DEAL

*  The term of the agreement is 10 years

* Microsoft will acquire an exclusive 10 year license to Yahoo!’s core search technologies, and Microsoft will have the ability to integrate Yahoo! search technologies into its existing web search platforms

* Yahoo! will continue to syndicate its existing search affiliate partnerships.

* Microsoft’s Bing will be the exclusive algorithmic search and paid search platform for Yahoo! sites. Yahoo! will continue to use its technology and data in other areas of its business such as enhancing display advertising technology.

* Each company will maintain its own separate display advertising business and sales force.

* Yahoo! will become the exclusive worldwide relationship sales force for both companies’ premium search advertisers. Self-serve advertising for both companies will be fulfilled by Microsoft’s AdCenter platform, and prices for all search ads will continue to be set by AdCenter’s automated auction process.

The search brand at Yahoo will remain to be “Yahoo Search” but it will have a label at the bottom of the page that says “Powered by Bing.” Nothing is changing now, not until they get regulatory approval, and then when they get that approval, they will begin pushing out the integration.

So Bing will now power search on Yahoo! and Yahoo!’s salesforce will sell the premium (non-self service) search advertising for Yahoo!/Bing. Bing also gets access to Yahoo!’s core search technology and can, at its option, leverage that to help create more relevant results.

BOTTOM LINE

Nothing is going to happen until 2010 at the earliest, so you do you have time to prepare.  I would say now that Bing will have a 15-28% share of the market, that it makes a lot of sense to start optimizing for BING now.  In the past MSN was hardly worth optimizing for because they usually didnt send much traffic but now it will make more sense.  A good tool to use to see the differnent results that come up now at Google and Bing, is the Bing v. Google tool.

Microsoft is expected to spend $80 million to $100 million on Bing marketing which would be a nice hedge against Yahoo! because Bing will most likely take market share from Yahoo!.

Whether Bing ultimately succeeds or not, it will push Google to keep innovating search, and the new pay per click competition will ensure that Google doesn’t get too greedy.

How is Bing different from Google?

Bing is not dramatically different from Google, but some people have found its results stronger. There are some visible changes:

• Bing shows a preview of the web pages in the search results when you hover your mouse pointer at the right side of the search results.
• Bing displays fewer results if it is certain that it has understood your intent. The search for “Facebook”, for example, brings up just one result linking to the site itself.
• Some search results are divided into categories. For example, if you search for the popular musician “Justin Timberlake”, you’ll get results in the categories news, songs, movies, biography, wallpaper and downloads. In addition, the search results show images, videos and the popularity of the musician.
• Wikipedia searches can be displayed inline in the search results without leaving the Bing site by clicking the “Enhanced view” link.
• Bing features a different background image every day. The image contains special hidden hotspots that lead you to more information (soon advertising?) about the image.
• Despite the background image, Bing’s homepage loads very quickly in your web browser because the search box and logo load first. You can turn off the background image.
• Bing’s video search lets you watch videos without leaving the search engine.
• Bing offers specific health, shopping and travel search engines, as well as instant answers to travel searches. For instance, the search “Vegas hotels” displays a selection of hotels in Las Vegas, including hotel stars and prices.
• Bing’s search history lets you return to your most recent searches of the last two days. This feature can be turned off to protect your privacy.
• Some of Google’s features are missing, for example, Bing doesn’t seem to recognize misspellings and returns no results in these cases.
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So far it looks like it has some cool features but it has the same results it always had in MSN.com. Some of the search results are better then Googles results but usually Google still has better overall results it seems but the jury is still out.  One thing is for sure, people are going to know the word BING because of the advertising MSN will do and enough people might actually use it but will they keep using it?