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Tuesday, June 3, 2008

MS Strikes a Deal with HP

Microsoft and Hewlett-Packard, already in partnership, are expanding their businesses together. Microsoft, after tasting failure in Yahoo! acquisition and after the talks between Yahoo! and Google on a search advertisement partnership, is under strong pressure to get higher search market share. And this caused their striking up a deal with HP to install Live Search engine in HP PCs.

HP is the largest distributor of consumer PCs in the US and Canada, and shipped almost 4 million PCs in the first quarter of 2008 alone. So, having Windows Live Search in all HP PCs is a huge advantage for MS. It will well equip Microsoft to fight Google better. In 2006, Google had struck up a similar deal with Dell to install Google search in the Dell machines as default search toolbar. Microsoft’s move can be seen as an afterthought of that.

Though many advanced users may change the default search back to Google or Yahoo!, this may enable Microsoft to get a good share in the search realm. Currently, Google holds 62 % of the search market and Live Search is at a deplorable 9 %.

Now, Live Search is the default search engine for Windows Vista, but the new deal will make Live Search have more visitors. Also, HP can boost their business through this partnership. HP, at a small fee, can point users to their specific technology websites and get some more sales.

Genuinely, what these tactics bring back to Microsoft and Hewlett-Packard is something to wait and see.

Copyright © Gayatri Jayashankar 2008