SES Keynote Conversation with Steve Berkowitz

ses keynoteSteve Berkowitz, former leader, is the Senior Vice President of Microsoft’s Online Services Group which includes MSN and Windows Live. He spoke with Danny Sullivan (Conference Chair) about Microsoft’s “search” aspirations @ SES NYC 2007 this morning. Steve seems excited about his role and proudly states “Microsoft is an amazing place and there’s so much creativity.

“It’s about unlocking the potential and learning how to market and bring to market [search products] in a more creative way. Focus on the basics is at the forefront.”  It’s clear from listening to Steve Berkowitz that working to engage Microsoft’s huge audience throughout the world is paramount. Also he repeatedly referenced Microsoft’s commitment to making search available in other UI’s (user interface) and user experiences. This means integrating extended search functionality in MS Messenger, Xbox and other MS products. [Get full SES coverage @ SES Roundtable]“The question becomes over time “how do we show value to partners, advertisers, content creators, and consumers in the search ecosystem. Steve stressed the goal of “operational excellence.” The evolution of a standalone PC to a network to the Internet is what’s next at Microsoft.  As a company they are focused on ways to extend the “Windows experience” to the Internet. Windows live is becoming an extension of the Windows desktop out onto the Internet. For Microsoft it’s about getting those search products right, especially the integration with of major brands like Microsoft Office and Windows OS.

sesDanny asked “will it be satisfactory for Microsoft to be #3 [in search] so long as it is a very successful business unit?” The Microsoft search “Chief” answered that goal in search is to “first reach critical mass, enough audience delivered to advertisers and no, it’s never satisfactory to be anything but #1.”

Danny pointed out that many customers get MS search as the default on a new computer and asked if MS perceives this as a particular edge in the marketplace. “Let’s earn it with the customer” Steve responded.  “If someone trys to change a default MS search [on a new computer] I want the customer to be ‘pissed off’ that someone is attempting to change [search defaults] away from a Microsoft search integration that customers love. “There are a large percentage of consumers that don’t change things from when the purchase their computers. The experience MS builds in to OEM partners’ new computers has to be a compelling experience for the end users.”

Steven would not comment on a potential “someday” deal with Yahoo.  There was even a visit from ms searchMs. Dewey” the actress featured in Microsoft’s experimental search engine. She harangued Danny and Steve for a few minutes before making her exit.

Steve noted “If we leverage the assets we have from Xbox, Desktop, Office MS will be able to ‘crack open the box’ of applications presently in the MS labs” which Steve called “awesome.” He specifically mentioned 2 new initiatives, IP TV and “Playtop Desktop.”

Acknowledging the Past
“This company has So much innovation, creative and talent, yet we as a company have not done a very good job at making us cool. I was just amazed at the level of technology behind the scenes we have not been nimble or bold enough to bring to the world. We’re going to build an amazing business and have a much greater share of the 5 billion dollar search business.” Steve approaches his tasks with a guerilla mentality as if he’s a little guy competing with all other MS API developers. “It’s not about leveraging windows. It’s about the audience. We have to earn our place in the value chain. We have to build on top of the MS API and the MS applications like everybody else. We strive to be the best developer shop for building on top of the windows platform.”

Microsoft Vs. Google and Yahoo
“It’s not whose ahead or behind. We all have great audiences. Microsoft has one of the largest audiences on the web. Other search engines are better at cross-engagement of user experiences, the way they make services act together. MS could get better at integrating search into other experiences. The advantage MS has is it’s reach. There are very few companies in the world in a financial position to invest in what’s next. Even operational issues like data storage for the next generation of search requires a huge infrastructure. MS has the ability of maturity which could be an advantage. We’re going to be a great partner for advertisers and publishers. ”

Steve closed by noting that “It’s been 11 months [at MS] and every time I move about the ship I find new and exciting things and exciting people. ” Here are Steve’s word association responses to Danny Sullivan’s traditional “Lighting Round” conclusion:

Google: “amazing”
Yahoo: “working hard”
AOL: “trying to hold its own”
Ask: “love it” (“you can’t take that away from me.”
MS: “potential”
Steve: “having fun”

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