Google chief sees Bing as main threat

"While it's true Web search is not the only game in town, searching information is what it is all about," Schmidt said in Wall Street Journal interview video posted online on Friday.

He described Apple as a well-respected competitor and Facebook as a "company of consequence doing an excellent job in social networking," but said that Microsoft's latest-generation search engine was Google's main competition.

"We consider neither to be a competitive threat," Schmidt said, referring to Facebook and Apple. "Absolutely, our competitor is Bing. Bing is a well-run, highly competitive search engine." Microsoft's Bing and other Internet search services overtook Yahoo! for the first time to become the number two search engine in the United States in August, according to The Nielsen Co.

Microsoft's Bing, MSN and Windows Live had a 13.9 per cent share of US search volume in August, up 0.25 per cent from July, while Yahoo! had a 13.1 per cent share of US Internet searches, down from 14.6 per cent in July, Nielsen said. Google continued to dominate the lucrative search and advertising market with a 65.1 per cent of all Internet searches in August, Nielsen said.

Year-over-year, Microsoft sites have increased their search share from 10.7 per cent in August 2009 to 13.9 per cent in August 2010 while Yahoo! has fallen from 16.0 per cent a year ago to its current 13.1 per cent, Nielsen said. Google held steady at 65 per cent.