Microsoft's stock gained $1.02, or 3.6 percent, to close Tuesday at $29.61, while Google's added $2.80, or 0.4 percent, to $777.65.
Microsoft developed its anti-Google ad campaign shortly after hiring former political operative Mark Penn in August as a corporate strategist who reports directly to Ballmer. Penn is best known as a former pollster for President Bill Clinton and a campaign strategist for Hillary Clinton's unsuccessful bid for president in 2008. Penn left his job as CEO of public relations firm Burson-Marsteller to help Microsoft generate more usage of its Bing search engine and other online services.
Microsoft isn't saying how much it is spending on the ad campaign beyond saying the amount will run in the "multimillions" of dollars.
Although there isn't any evidence that the ads have hurt Google yet, Sullivan said Microsoft is pleased with the response. The company says about 117,000 people have signed Microsoft's online petition protesting Gmail's ad-driving scanning of content. That's a sliver of the more than 425 million Gmail accounts worldwide. Microsoft says about 4 million people have visited Scroogled.com, the website that serves as the hub of the company's anti-Google campaign.
Although the attack ads are something new for Microsoft, denigrating the competition isn't. Most notably, Microsoft tried to undermine Web browser pioneer Netscape Communications beginning in the mid-1990s. Most of that sniping remained behind the scenes until a U.S. Department of Justice investigation into Microsoft's business practices exposed the cut-throat tactics deployed to overcome Netscape's early lead in the Web browser market.
Given that history, Microsoft's marketing assault on Google isn't that surprising, said Cusumano, who has been following the company for 20 years.
"Nothing is below Microsoft," Cusumano said. "They have been playing dirty for a long time. In this instance, they probably sincerely believe this can give them a little marketing edge and help them capitalize on the growing discomfort with the size and influence of Google."
Microsoft campaign: http://www.scroogled.com
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