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Microsoft's canceled 'Project Brazil' took aim at Amazon, eBay

Stealth effort would have baked e-commerce into Windows

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Microsoft recently considered building its own online marketplace to compete with the likes of Amazon and eBay, but has since abandoned the plans, sources claim.

The effort, known within Redmond as "Project Brazil", would have seen the company create an e-commerce hub that would have played host to a variety of retailers and tech companies, the Wall Street Journal reports.

"Project Brazil was an incubation to enable a more direct commerce model between customers and brands and merchants," a Microsoft spokeswoman told the WSJ.

Microsoft already operates Bing Shopping, which allows users to compare prices on products and connect with participating merchants, but sources with knowledge of the software giant's plans say Brazil would have seen Microsoft taking a more active role in transactions.

The e-commerce features would have been baked into a future version of Windows for PCs and tablets and eventually into other products, too, such as Microsoft's Xbox gaming consoles.

The store might have offered customers deep discounts, because Microsoft was reportedly considering subsidizing the prices of merchandise based on the amount of ads merchants bought on Bing or Redmond's other online properties.

Microsoft declined to say when it canceled its plans, or why – but it was probably a good decision. Try as it might to emulate Google, Microsoft's online properties have never been as successful as its rival's, and Redmond's online division routinely posts losses.

According to figures from eMarketer, Microsoft brought in just 3.8 per cent of all search ad revenue last year, so using ad sales to subsidize product pricing doesn't sound like all that great of an idea, either.

Don't expect Microsoft to give up on e-commerce, though. With online sales now topping $1bn annually, you can bet Redmond wants a piece of that pie. Project Brazil apparently just wasn't the right knife to slice it with. ®

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