Microsoft to acquire semantic search engine Powerset?

By buying Powerset, Microsoft is hoping to close the perceived quality gap with Google’s search engine. The move comes as Microsoft CEO Steve Ballmer continues to argue that improving search is Microsoft’s most important task. Microsoft’s market share in search has steadily declined, dropping further and further behind first-place Google and second place Yahoo.

Google has generally dismissed Powerset’s semantic, or “natural language” approach as being only marginally interesting, even though Google has hired some semantic specialists to work on that approach in limited fashion. Google’s search results are still based primarily on the individual words you type into its search bar, and its approach does very little to understand the possible meaning created by joining two or more words together.

That’s where Powerset sees an opportunity for growth, and perhaps where Microsoft finally sees a chance to get a quality edge. However, Powerset’s technology has remained controversial to people within the industry because, while sexy in theory, the natural language approach is difficult to pull off in practice.