Microsoft, Vexcel and Local Search
Microsoft today confirmed that it had acquired Vexcel, a mapping and remote sensing company that primarily works for the US government. Vexcel has been around for about 20 years and has a long history in the space. The news had been out but there had been no formal announcement until today.
Steven Lawler, GM of the Virtual Earth (VE) team, lead a conference call and discussed Microsoft’s strategy to create a “rich, immersive experience” via Virtual Earth and Windows Live Local (WLL). He said the thing that’s “still lacking” in mapping and search generally is the ability to “explore and discover information in an intuitive way.”
Lawler said that Microsoft’s vision is to digitally recreate the real-world framework that people navigate everyday. A “digital world” to Lawler is fundamentally visual with lots of rich photography and 3-D imagery. Lawler said that Virtual Earth will bring together the “best visuals, best content and user-generated content” (including local business information) with WLL. Lawler explained that Microsoft is offering both a destination and a platform: VE is the platform; WLL the destination.
Vexcel was acquired for its personnel, its technology and its existing (government) relationships. Lawler stressed Vexcel’s experience in acquiring and processing imagery – reportedly have the leading “airborne digital camera” in the marketplace (260 megapixels).
Vexcel reportedly offers complete automation from data acquisition and content creation to processing. This was one of the things that Microsoft’s Search GM Erik Jorgensen previously stressed to me was a competitive advantage about Vexcel. Others I’ve spoken to have expressed skepticism, however, about the ability to fully automate 3-D rendering online.
Microsoft said that “streetside” and 3-D imagery would be integrated side by side. He said that the company was working on multiple types of imagery in parallel and would present different types of imagery in context and would offer consumers choices.
Lawler then answered a question about the revenue model, responding that local advertising would be significant on the BtoC side. Lawler argued that most online advertising today is not as targeted and “in context” as it could be. He said, “We think we can do a much better job of delivering highly contextual and relevant advertising.” (He’s not talking about AdSense here .)
“We want to build the most compelling offering on the market – quicker more relevant more powerful,” said Lawler. “We have a vision that’s much further along and we are the technology leader in the space.”
He added that WLL has “12 or 13 million uniques per month” and that 25% of those users spend between “10 and 30 minutes on the site,” which is both surprising and impressive.
What does all this mean? Microsoft means to turn Local Search into a completely visual experience — on a global basis. For Microsoft this is a new “search paradigm,” a visual search paradigm. Clearly map-based search won’t work for all needs and categories, but it is something fundamentally different than exists today.
This is a hugely ambitious project and it remains to be seen how fully this vision is realized and in what kind of time frame. Regardless, Microsoft is about to “up the stakes” on what the future of online mapping will look like – and maybe the future of search itself.
Greg Sterling is the founding principal of Sterling Market Intelligence, a consulting and research firm focused on online consumer and advertiser behavior and the relationship between the Internet and traditional media, with an emphasis on the local marketplace.