Seattle -- Old foes mending their differences to achieve a common goal: compete with Google the Goliath! In its latest attempts to boost its dwindling share of the online search market, Microsoft Corp. on Monday said that it has reached a Web search deal with Sun Microsystems Inc., under which the software maker will bundle its search technology and other content alongside Sun’s widely used Java application environment.
Under the terms of the deal being announced Monday, users of Microsoft’s Internet Explorer browser who download Sun’s Java Runtime Environment (JRE) will be provided with an option to also download Microsoft’s MSN Search Toolbar, this will give users direct one-click access to Microsoft’s Live Search site as well as other features from the MSN network, including news, sports, and entertainment content.
Sun will propagate a Microsoft toolbar for the Internet Explorer browser to U.S.-based Web surfers while they download Sun’s Java software -- which is necessary to view some Web sites. The toolbar has a built-in box for queries to Microsoft’s Live Search and buttons that give people access to MSN content.
“We need to supply more volume to our advertisers,” said Angus Norton, a senior director in Microsoft’s Live Search group. Microsoft ranks a distant third in the Web search market behind Google Inc. and Yahoo Inc.
The software colossus is searching beyond Yahoo as it attempts to promote its presence in the key Internet search market. This is the latest partnership struck by Microsoft intended at blocking the dominance of Google Inc.
“This partnership with Sun Microsystems is another “watershed moment” in our strategy to secure broad-scale distribution for our search offering,” said Yusuf Mehdi, senior VP for Microsoft’s Online Audience Business unit, in a statement.
For Microsoft, the deal is an exemplary coup because it partly replaces a high-profile agreement Sun struck with Google in 2005 to bundle the Google toolbar with Java.
Regardless of a number of initiatives, including offering cash back to users who use its Live Search to buy products, Microsoft has seen its share of the search market continue to fall, while Google’s has continued to rise.
Given the extensive range of Java-based applications downloaded each month, the partnership could bring a larger exposure to Live Search to millions of additional users. Mehdi said he expects the agreement to “pull increased volume for our search advertisers”. Sun estimates that there are more than 800 million Java users worldwide.
“As an operating system-agnostic platform, Java allows applications to run on numerous types of computer systems, including Windows PCs and Macs.”
Brad Goldberg, general manager of Microsoft’s Search Business Group, said the agreement with Sun is part of the company’s tactic to boost the distribution of Live Search.
He remarked that earlier this year, Microsoft had also reached an agreement with Hewlett-Packard Co, the world’s largest personal computer maker, to place a Microsoft toolbar on new PCs in the United States and Canada. That deal goes into effect in January.
Goldberg refused to talk about how much traffic Microsoft is expected to generate from the arrangement with Sun. But he stated that across the market, about 35 percent of search queries come from entry points such as a toolbar, the address bar or a search bar within a browser.
Sun and Microsoft have competed acrimoniously on several fronts. In particular, Sun was one of the most prominent antagonists in Microsoft’s long antitrust battles. In 2004, Sun reaped nearly $2 billion in a patent and antitrust settlement payout from Microsoft.
Microsoft is looking for alternatives to Yahoo.
In the wake of its failed attempt to acquire Yahoo -- the No. 2 provider of paid search services behind Google, Microsoft needed to find an alternative way to grow its search business. Google controls around 62% of all search traffic in the United States, followed by Yahoo, which owns about 21% of the market. Microsoft is in third place with a 9% share, according to market watcher ComScore.
Last week, after Google dumped Yahoo, Microsoft CEO Steve Ballmer said the company is not interested in a renewed attempt to buy out Yahoo. The comments sent Yahoo’s shares plunging more than 12% on Friday.
Eric Klein, the vice president for Java marketing at Sun, declined to say how many users had downloaded the Google toolbar via Java. But referring to the bundling, he said, “it is clear it is working,” judging by the interest of companies such as Microsoft.
Sun and Microsoft did not disclose the financial details or the length of their new deal. The agreement between Sun and Microsoft; shows once again how far the two companies’ relationship has progressed.
“The nature of the basic relationship between Sun and Microsoft has changed significantly over the past couple years,” Sun’s Klein said. “This is another interpretation of that.”