In an attempt to reclaim some of the ground that it has lost to Google, Microsoft unveiled Bing, a new internet search engine.

Bing replaces Microsoft's Live Search product, which has failed to dent Google's huge lead in search market share. Bing, described as a “decision engine”, is designed to understand what users are searching for on the internet and display more than just the traditional “ten blue links” pointing to websites.

Microsoft has been stuck in third place behind Google and Yahoo! — its share of US search queries was 8.2 per cent in April, according to the research group comScore. Google was used for 64.2 per cent of queries, and Yahoo's share totalled 20.4 per cent.

Google's lead is even greater in the UK and its lead helps it generate huge profits from search advertising. Microsoft recorded a loss in its online advertising business for the first quarter of this year.

Steve Ballmer, Microsoft chief executive, told a conference in Carlsbad, California: “Today, search engines do a decent job of helping people navigate the web and find information but they don't do a very good job of enabling people to use the information they find. When we set out to build Bing, we grounded ourselves in a deep understanding of how people really want to use the web.”

Bing promises to make things like buying a digital camera, booking a flight or searching for a restaurant easier by serving up results based on similar previous searches.

The new service will be available next week in the United States with a beta launch of a UK version of the engine at the same time. The service will be available at bing.com.

Microsoft is reported to be spending as much as $100 million on advertising the new service. Mr Ballmer said Microsoft had called its search engine Bing because it wanted something short and catchy but it was not named after Bing Crosby.

The term “to Google” quickly became synonymous with performing a search on the internet after the company launched in ground-breaking service a decade ago. Mr Ballmer said of Bing: “The name is short, it's easy to say, it works globally. It's been proved that being able to 'verb up' can be helpful.”

Mr Ballmer said that he was still interested in doing a search partnership with Yahoo! but played down the possibility of an acquisition. Microsoft tried taking over Yahoo! last year but after Jerry Yang, the chief executive and co-founder, rebuffed its $47.5 billion offer, Microsoft turned its attention to building a better version of Live Search. All leading search companies including Google and Yahoo! have launched new features and services in recent weeks. But analysts are uncertain that new technological features alone will woo users.

Andy Mihalop of the i-level online media agency, said: “It's going to be very difficult for them to break the Google habit, because Google is such a familiar brand. I can see people who do use it will become more engaged but Microsoft is going to have to invest a huge amount in advertising to get people away from Google.

“Also, as far as advertising goes, our clients are still predominantly looking at market share. So for most advertisers Google will remain first choice, though I would like to see a successful challenger emerge.”

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