Microsoft and Google Continue Search Battle on PC Desktops

The front page of today's Wall Street Journal has a nice article about how Google and Microsoft are battling for space on PC desktops. The article starts by talking about Google trying to get its products preinstalled on PCs, but buried in the article is behind the scenes wrangling about setting the default search engine on a user's PC.

Quoting the WSJ,

After months of back and forth, Microsoft backed down on some, but not all of the debates. Mr. Hachamovitch recently demonstrated the latest test version of Explorer. The built-in search box features options such as "Get Search Providers" and "Change Search Defaults" that enable users to select search engines from AOL, Ask Jeeves, Google, MSN and Yahoo. "Our overriding principle from the get-go is 'respect user choice,'" he says. "There's no desire to do anything other than that."

Microsoft was a stickler on one matter that irked Google. Anyone who upgrades to Microsoft's new browser out this year will automatically inherit their old browser's default search options. In the old browser, that barely mattered, because it didn't include an easy-to-find, built-in box linking to a search engine. The new version does, and that is a problem for Google, which is set as the default for only a tiny fraction of computer users. By contrast, Google handled 46% of U.S. search queries in November, according to research firm Nielsen/NetRatings.

Google wanted Microsoft to ask consumers directly which search service they wanted as a default when upgrading from older versions of Explorer -- a change Microsoft felt was intrusive. Google also wanted to know if users had already selected it as the default search provider in Explorer. "We looked at that as a major privacy violation," Mr. Hachamovitch says.

In December, for these and other reasons, Google refused to sign an agreement with Microsoft relating to the new browser's search capabilities. Microsoft left Google off the list of alternative
search services. A month later, Microsoft notified Google it would be included
on the list with or without a signed agreement, according to people familiar with the matter. Microsoft says after a review of its legal position, it realized it could include Google without a formal pact.