Barry Diller Makes Excuses for Ask.com's Failures

Trying to compete in the search game has left a sour taste in Barry Diller's mouth -- specifically, the taste of sour grapes.

During a conference call to discuss IAC's (IACI) second-quarter earnings, Diller, the web company's chairman, at times sounded like he was taking personal responsibility for the failure to turn Ask.com into a viable alternative to you know who. "I was wrong about the competitive landscape with Google," he said. "Ask itself is not a large segment of the company. I had hoped it would become one, but I was wrong about that."

But in the next breath, Diller suggested that, in a sense, Ask actually succeeded too well. "[A] lot of our new features that Ask has been sporting has only helped the competition, as they've copied us at every turn," he said. (In response, the search engine is adopting a new model that harnesses human intelligence in order to "deliver answers -- not just links.") Ask's failure, he implied, was really one of expectations and marketing, not one of substance. "We've learned that spending a lot of money on marketing search products doesn't get you very far," he said.

That might come as news to Microsoft (MSFT), which has poured tens of millions of dollars into pushing its new-ish search service, Bing, over the past year. Bing has seen its share of the search pie nearly double over that time, from 6.5% in June 2009 to 12.7% this year. That's nowhere close to Google, which owns 62.6% of searches, but it is within striking distance of third-place Yahoo (YHOO), at 18.9%. And Ask? It's down near the bottom, with 3.6% (although still ahead of AOL, parent of DailyFinance, which has a 2.2% share).

Ask and you shall receive? Not necessarily.