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Monday, June 18, 2007 - Page updated at 12:00 AM

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Microsoft vs. Google | The duel on your desktop

Seattle Times technology reporter

Just as a major episode in Microsoft's antitrust saga was winding down, a complaint from its biggest rival threatens to push the company's competitive practices back into the spotlight.

The stage was set by a New York Times report last week that identified Google as the source of a complaint to federal regulators.

Since at least last fall, the search giant has complained privately to the Department of Justice that a desktop search feature built into Windows Vista elbows out competitors and violates the terms of Microsoft's landmark 2001 antitrust settlement with the government.

The legal action will likely play out next in the pages of a joint report due Tuesday from Microsoft and the squad of federal and state government lawyers bird-dogging its compliance with a consent decree stemming from the settlement. The decree spells out what Microsoft must do to remedy its anti-competitive conduct with Windows, the operating-system software installed on more than 90 percent of the world's computers.

A week later, on June 26, the scene will be the courtroom of U.S. District Judge Colleen Kollar-Kotelly in Washington, D.C. Even if the joint report is silent on the Google complaint, observers expect the judge to broach the issue at a regularly scheduled hearing to monitor the status of the settlement.

The stakes are high. The center of gravity in computing is shifting from the desktop — where Microsoft's Windows monopoly was worth $13.1 billion in sales last year — to the Internet. Companies are competing to attract users to their online services for search, e-mail and other tasks that used to be the purview of desktop software alone.

For Google, a prominent spot for its desktop search tool on Windows PCs can help direct millions of people to its online empire, where it makes billions selling advertising.

Forming accusations

Mountain View, Calif.-based Google filed a formal 49-page complaint with the Justice Department in April detailing its concerns with Vista desktop search. That document has not been made public. Microsoft lawyers haven't seen it, either.

Google would not comment beyond a prepared statement that gave a bare outline of its gripe.

"Microsoft's current approach with Vista desktop search violates the consent decree and limits consumer choice," Ricardo Reyes, a company spokesman, said in the statement.

Microsoft contends Vista's desktop search feature, designed to help users quickly find files on their own computers (as opposed to searching the Internet), does not block competitive products and falls well within the terms of the consent decree. Company lawyers say Microsoft went out of its way when building search into Vista to make sure that it is not linked to the company's own online services.

Microsoft made other search-related changes to Vista after a separate Google complaint.

Browser complaints

Last year, Google and others complained that the Internet-search box built in to Vista's Web browser, Internet Explorer 7, defaulted to Microsoft's search engine.

Citing a desire to give IE7 users maximum choice, Microsoft aimed to make it easier to add, subtract and change search engines and set any one — including market dominator Google — as the default.

Google appears to want the same thing for the desktop search boxes built into folders in Windows Vista.

"The search boxes built throughout Vista are hard-wired to Microsoft's own desktop search product, with no way for users to choose an alternate provider from these visible search-access points," Reyes said in the statement.

User entries

While these built-in Vista desktop search boxes can't be changed to run a competitor's desktop search, Microsoft said it has done nothing to prevent users from accessing competitors' desktop search tools in other ways.

Vista provides several "entry points" for competitors' products, including in the Start menu, on the task bar at the bottom of the Vista desktop, on the desktop itself, and in the form of a "floating deskbar" that is always on top of other open windows.

Google also takes issue with the Vista indexing function that runs behind the scenes, essentially creating a constantly updated database for the desktop search functions to quickly scour. Google has one, too.

"Vista makes it impractical to turn off Microsoft's search index," Reyes said, the implication being that if users were using only Google Desktop Search, they wouldn't need indexers from both companies running simultaneously.

Microsoft said that its indexer can be turned off in the Control Panel, or through another setting. But this process is not explained in the list of "common questions" attached to the menu for adjusting the indexer.

The company also suggests that users shouldn't need to turn it off because the indexer is designed to yield computing power to other applications so that a user isn't even aware that it's running.

Making progress?

While the Google complaint spilled into the public only recently, behind-the-scenes jockeying has been going on for months.

Microsoft says it has been responding to questions regarding the complaint and negotiating with the Department of Justice and the 17 states involved in the 2002 antitrust settlement.

Microsoft was made aware of the Google complaint by the DOJ in early December, a few days after Vista went on sale to businesses.

But even before that, Microsoft had discussed with the state attorneys general and DOJ whether desktop search should be affected by the consent decree. They concluded it shouldn't, Microsoft spokesman Jack Evans said.

Despite that conclusion, Evans said the parties have been exploring whether there's something Microsoft could or would do to change Vista desktop search to resolve the issue.

Tuesday's status report could signal whether the negotiations have been fruitful.

Microsoft would like to resolve the issue quickly and quietly. Much of the consent decree is set to expire in November, and the company is eager to put this episode in the past.

Evidence suggests the DOJ may be less inclined to pursue the complaint than the state attorneys general.

The New York Times story focused on the Bush administration's defense of Microsoft on antitrust issues and described a memo from a top Justice Department antitrust official, Thomas Barnett, that suggested the states reject the Google complaint.

Barnett formerly worked for a law firm that represented Microsoft on antitrust matters, though he did not work those cases, the Times reported.

Some state attorneys general suggested last week that they are interested in pursuing the Google complaint.

A spokeswoman in the office of Connecticut Attorney General Richard Blumenthal, one of a handful of state officials to speak publicly on the matter, said Friday that no decision had been made.

If the government doesn't pursue the Google complaint under the consent decree, Google could choose to launch its own antitrust campaign against Microsoft, said Albert Foer, president of the American Antitrust Institute, a Washington, D.C.-based nonprofit advocating for more competition in the interest of consumers.

"That'd be a helluva fight, wouldn't it? ... They're both very strong, very creative, very well financed and can engage in a large-scale strategic battle on a global battlefield," Foer said.

Benjamin J. Romano: 206-464-2149 or bromano@seattletimes.com

Copyright © 2007 The Seattle Times Company

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