Qi Lu

What can the son of a desperately poor Chinese country family do for the world’s richest company? Find a way to stop Google’s headlong rush toward total domination of a 100% searchable universe.

At the age of 47 Qi Lu is generally considered the world’s leading search mind. That’s why he’s president of Microsoft’s Online Services Group. He left Yahoo in June 2008, reportedly after becoming disillusioned by the company’s lack of drive in overtaking its search rival. Some time after the departure of Microsoft’s search chief in July Lu began talking with Microsoft. That led to a long meeting with CEO Steve Ballmer in September. In early December Lu accepted Ballmer’s offer of big money, a big title and a direct reporting relationship with Ballmer himself.

Lu took charge of Microsoft’s online services on January 5, 2009. The first fruits of his efforts became visible with Bing, Microsoft’s revamped search engine. After its heavily advertised debut in June Bing lifted Microsoft’s share of the search market from about 8.4% to just under 9% by July. That still left Microsoft in distant third place, behind Yahoo with roughly a 19.5% share and leader Google with a commanding 64.7%. As Lu has said, he has his work cut out for him in his new position.

Another early fruit of Lu’s move to Microsoft was the deal, announced in September, that Yahoo would direct its vast traffic to the Bing search engine. Lu pushed his team to work nights for weeks to find a way to find a partnership that would benefit both a post-Yang Yahoo and a Google-hunting Microsoft. When that deal wins regulatory approval from the U.S. and the EU, probably some time in 2010, Bing will still be in distant second place with no clear path for gaining on a rival that has made itself ubiquitous with its favored place on browsers and operating systems sold with many leading brands of personal computers.

But Lu has two powerful forces on his side: a legendary work ethic and a missionary zeal to continue the mission that has been driving him since 1998 when he joined Yahoo. By 2002 Yahoo was awakening to the realization that its original mission as the internet’s leading hierarchical directory was being superceded by search, especially as that function was being defined increasingly by Google.

Yahoo tasked Lu and others to use Inktomi as the foundation for Yahoo’s own search engine in 2004. Lu was involved in other efforts to make Yahoo a more compelling internet resource. Among them are My Web 2.0; Yahoo! Answers, Maps and Local services; Yahoo’s advertising system, Project Panama; and the Flickr and acquisitions.

Through it all, as executive VP of Yahoo’s search and ad technology group, Lu became increasingly frustrated by what he perceived as Yahoo’s unwillingness to commit enough resources to the goal of catching Google. Lu’s decision to leave Yahoo in June came a few weeks before Kevin Johnson’s departure from the head of Microsoft’s Online Services Group. Steve Ballmer recognzed that, in light of the ground Yahoo had ceded to Google during the internet’s formative years, Lu’s success in eking out a 20-point search share for Yahoo indicated the potential for real success when paired with the resources Microsoft was willing to bring to bear. His offer to Lu apparently showed that willingess to pair the right talent with the required resources.

“It’s an unfinished mission that I would like to work on,” Lu told a reporter in August. Why? Because Lu believes that search advertising is the internet’s most powerful force, one that’s too important to be controlled by one company.

Lu’s elevation to what is arguably the single most important job for Microsoft’s future is remarkable at a time when American business is still mostly run by executives steeped in finance, marketing or professional management backgrounds. It’s as strong an indicator as any that we’ve arrived at an era when it takes a first-rate techie to lead the bid for a slice of the internet’s future.

Lu’s beginnings were as far removed from a career near the apex of a global tech empire as can be. Qi was born to a desperately poor family in a small remote village without electricity and running water and was raised by grandparents. Lu sees his early hardships as having equipped him with certain advantages. “You can say it’s harsh, but it teaches you so many things,” he explains.

Lu excelled in school and gained admission to prestigious Fudan University in Shanghai where he earned a master’s in computer science. Lu’s next big break came when he attended a talk by a visiting professor from computer science powerhouse Carnegie Mellon. Professor Edmund Clarke was impressed by the intellligence of Lu’s question. After a conversation about Lu’s research, Clarke invited Lu to apply to Carnegie for a doctorate program. Lu couldn’t afford the application fee on his $10 per month university teaching stipend. Clarke had the fee waived and Lu was admitted.

Lu earned his Ph.D. in 1996, then went to work as a Research Staff Member at IBM’s prestigious Almaden Research Center. Two years later he joined Yahoo. In 2000 when Yahoo awoke to the burgeoning importance of search advertising and Google’s uncontested dominance, Lu was placed in charge of search and search advertising technologies. Before long Lu found himself directing a team of 3,000 engineers.

“He shunned the limelight, but he was considered one of the stars of Yahoo,” recalled Tim Cadogan who worked with Lu at Yahoo.

The secret to Lu’s rapid rise from a foreign grad student to an admired technologist and corporate manager was his ability to outwork everyone around him, according to all who knew Lu during those years. That quality earned Lu not only admiration but respect and loyalty from those who worked with him — an important asset in Lu’s current mission to apply the best talent available to the crusade to reel in Google.

That work ethic hasn’t changed. But another aspect of Lu’s life appears to have evolved as Lu grows into his role as a top general in what may well be the business world’s biggest tech war. He was described as a modest, quiet and inwardly-directed man by friends from his early years at Yahoo. But since arriving at Microsoft Lu appears to have expanded his social networking skills. He has appeared at growing numbers of industry events, including social gatherings hosted by Asian American professional organizations. That isn’t surprising. His success may well turn on his ability to apply insights about his own inner workings to woo others like him who are willing to give heart and soul to the quest to better divine the wishes of those who submit search requests.

“Qi at Microsoft is a dangerous thing for Google,” a former colleague of Qi Lu observed.