The latest search engine market report from the AT Internet Institute reveals that Bing has taken Yahoo’s place as the second most popular search engine for UK internet users.

Ever since its launch in the US in June 2009, Microsoft’s search engine has been tipped by those in the search engine marketing industry as a successor to Yahoo’s place as the second most popular search engine behind Google. In the American market though Bing has yet to fulfil this potential; although Yahoo’s share has steadily decreased whilst Bing’s has dramatically grown, average reports put the incumbent with a share of around 15% and Bing with a share of about 6%.

One reason behind this is that the US search market is more varied than the UK’s. Although Google has a share of around 70% in the states, its position in the UK market is even stronger at 89.7% and other engines are far less popular.

Outside of the US though, Bing appears to be increasing its position in the market for search engine users – a key factor in deciding where search engine marketing companies direct their SEO efforts or run PPC campaigns – whilst Yahoo is falling out of favour. Across Germany, Spain, France and the UK, the company’s share has fallen to some degree whilst Bing has retained its position in every market but France (where Google posted a 0.3% increase at Bing’s expense).

In both France and the UK Bing is now the second most popular search engine, whilst in the other markets it comes in third behind Germany’s T-Online and Spain’s Conduit search.

Judging from the UK’s traffic statistics from the AT Internet Institute, it appears that Yahoo’s drop from 4.1% to 3.6% of share between February and March 2010 has seen traffic go to smaller search engines (those outside of the top 5) rather than to any of the bigger engines.