Microsoft

Microsoft said Monday that it's cutting by a third the subscription prices for the hosted versions of Exchange, Sharepoint, and Office Communications Server.

The software maker plans to cut the monthly per-user cost of licensing all three products from $15 to $10, while the cost of licensing individual products is also dropping by as much as 50 percent. The move comes as Microsoft faces continued pressure from rivals, including Google.

Capossela

(Credit: Microsoft)

Last week, the city of Los Angeles voted to go ahead with a deal to shift many employees to Google Apps from Microsoft Office.

In an interview, Microsoft Vice President Chris Capossela said the move has less to do with competitive pressure than that "it's the price that customers are really excited to buy our suite at."

In addition to the price drop, Microsoft is also touting several new customers and announced its plan to bring the year-old Microsoft Online services to more than a dozen new countries.

The company is announcing its commercial launch in Singapore, as well as trials in Brazil, Chile, Colombia, Czech Republic, Greece, Hong Kong, Hungary, Israel, Malaysia, Mexico, Puerto Rico, Poland, Romania, and Taiwan. Microsoft also expects to have commercial availability in India later this year.

Among the new customers are McDonalds, Aon, Lions Gate Entertainment, and Rexel Group. They join existing customers, such as Blockbuster, Coca-Cola and Autodesk as those paying Microsoft to run hosted versions of its products. Microsoft formally launched Microsoft Online at a San Francisco event a year ago.

Next week, Microsoft will also formally launch Exchange 2010 at its TechEd Berlin developer event. Microsoft said last month that it had finalized the product. Traditionally, Microsoft has developed products first as a server and only later, if at all, customized them to run in hosted form.

Exchange 2010, though, was designed first as an online service and then crafted into a product that businesses can run on their own servers.

Programmers have mostly overcome a crucial hurdle to releasing a beta version of Chrome for the Mac, printing support, but several Windows 7 features won't make the cut for the present 4.x version of Chrome.

The Mac printing support is now added, according to the Google browser's issue-tracking system, though there are "minor remaining issues" and the new features aren't yet distributed with the software.

Google has cited Mac printing support as one holding back a Mac version of the browser. Mac support is important for the company's ambitions to spread the browser and its fast-Web philosophy to mainstream users. The Linux version, while less mainstream now, also is important since it's the foundation of Google's Chrome OS project to build a browser-based operating system for Netbooks.

But on the Windows side of the shop, a number of planned features to support Windows 7 were pushed back to the next version Chrome on Wednesday. That includes support for showing thumbnails of open tabs on the task bar, showing "jump lists" for quick actions such as links recently or frequently visited pages, pinning thumbnails to the task bar, and overlaying a download progress status bar on the Chrome icon.

The present beta and stable releases that Google issued Monday, Chrome version 3.0.195.27 (download for Windows only), are members of the 3.x family. The developer preview is in the 4.x family (download for Windows or Mac OS X). The Windows 7 features had been slated for the 4.x series, but now are planned for version 5, according to the issue-tracking system.

The change doesn't indicate the features have retreated into the distant future, though; Chrome version numbers change relatively rapidly, as evidenced by the move to version 4 in just over a year.

Also pushed back to the 5.x series is built-in support for discovering when Web pages have RSS feeds, one of Chrome's most-requested features. Its absence is ameliorated by a Chrome sample extension for RSS, though.

Extensions remain a work in progress. New ones are arriving steadily, and existing extensions such as Lastpass for filling in passwords and forms and AdSweep for blocking ads is progressing. But Google recently switched interfaces, dropping the use of a toolstrip across the bottom of the browser with pop-up "moles" in favor of browser actions, small icons along the top of the browser.

Microsoft's top lawyer said that a tentative agreement with Brussels announced earlier Wednesday could potentially allow the software maker to move out of the regulatory crosshairs, perhaps paving the way for regulators to shift their attention elsewhere.

"It's important for us to get closure in Europe on issues that have obviously been controversial for over a decade," General Counsel Brad Smith said in an interview. "Today's decision takes us an important step closer to doing that."

Smith

(Credit: Microsoft)

Microsoft initially took a much different approach to the European Commission's assertion that the inclusion of a browser in Windows violated antitrust law. The company had initially proposed just stripping out the browser from Windows 7 entirely, leaving users the prospect of trying to get a browser on their own. The software maker eventually backed down after indications that that approach was unlikely to fly.

While not final, Microsoft's moves would appear to resolve all of its outstanding regulatory issues with the Commission and were greeted warmly by regulators on Wednesday.

Although most of the early attention focused on the agreement around a browser "ballot screen," Microsoft also announced on Wednesday an agreement around product interoperability. Under that deal, a 10-year commitment by Microsoft, the software maker agrees to publish communication protocols and adopt certain standards as part of Windows, Windows Server, Office and other high market share products. Companies could also purchase for 5,000 euros a warranty that would subject Microsoft to court oversight and monetary penalties if it doesn't live up to its commitments.

Smith said that the approach Microsoft took with regard to interoperability was designed to adopt methods that Nellie Kroes, commissioner for competition, had outlined in a speech last year for how companies with high market share products should behave.

"I actually think this in effect implements the model that the Commission has been advocating," Smith said. Moreover, he said it is a model that other software companies should pay attention to, he said, noting that there are lots of companies that have high market share. He noted that Google has 78 percent of the paid search market and IBM has 100 percent of the mainframe market, while Adobe also has dominant positions in certain areas, such as Photoshop.

"It is important we believe to create a level legal and regulatory playing field," Smith said. "Everyone that has a high market share needs to respect the same set of rules. I think a number of these rules are likely to be applicable to other companies and other products."

Settling now with Brussels also could help Microsoft in its effort to win approval for its search deal with Yahoo, Smith said.

"This certainly isn't going to hurt when it comes to the Yahoo-Microsoft agreement," he said. "It's not necessarily going to make a huge difference. We didn't feel a particular step was needed to help it along."

Microsoft is in the process of trying to ascertain whether the deal needs approval from Brussels or from individual European antitrust authorities. It also needs approval from U.S. regulators, who have asked for more information on the deal.

Microsoft on Thursday lashed out against Google Chrome Frame--an Internet Explorer plug-in that supplants IE's rendering engine with Google's.

The software maker, in a statement, said users are better off moving to a later version of Internet Explorer if they want the latest technology as opposed to using Chrome Frame.

Google plans to use Chrome Frame to, among other things, allow people to run Google Wave from within Internet Explorer.

(Credit: Google)

"With Internet Explorer 8, we made significant advancements and updates to make the browser safer for our customers," Microsoft said. "Given the security issues with plug-ins in general and Google Chrome in particular, Google Chrome Frame running as a plug-in has doubled the attach area for malware and malicious scripts. This is not a risk we would recommend our friends and families take."

However, some took Microsoft to task for criticizing plug-ins, noting that Redmond itself has more than a few.

"Microsoft scared of security of plug-ins. Uninstall Silverlight now," Mozilla's Dion Almaer wrote in a Twitter posting.

Google announced Chrome Frame on Tuesday, saying it can be used with Internet Explorer 6, IE7, or IE8 to use Chrome to render Web pages and execute their JavaScript programs. To work, users have to install the plug-in and Web developers must insert a line of code onto their Web sites that engages Chrome Frame when a person visits the site.

Update, 12:35 p.m. PT: I had a chance to chat with Amy Barzdukas, general manager for IE.

In addition to reiterating the security risks associated with running what she called "a browser within a browser," Barzdukas said that using Chrome Frame also interferes with the private-browsing and clear-browser-history features within Internet Explorer 8.

"That is not made clear," Barzdukas said. "That is a trade-off that customers would really want to make with eyes wide open."

Barzdukas also rejected the notion that it offers a good option for those still using Internet Explorer 6.

"If you are a user of IE6, you should get off IE6, not install another add-on," she said. "It just compounds your problem."

Update 3:20 p.m. PT: Google offered up a statement on its own, explaining its thinking behind Chrome Frame.

"Google Chrome Frame is an open source plug-in that is currently in an early developer release and was designed with security in mind from the beginning," Google said. "While we encourage users to use a more modern and standards compliant browser such as Firefox, Safari, Opera or Google Chrome rather than a plug-in, for those who don't, Google Chrome Frame is designed to provide better performance, strong security features, and more choice to both developers and users, across all versions of Internet Explorer."

Although it does increase the surface area, Google notes it brings some security features of its own, particularly for those running IE6. "Accessing sites using Google Chrome Frame brings Google Chrome's security features to Internet Explorer users, providing strong phishing and malware protection (absent in IE6), robust sandboxing technology, and defenses from emerging online threats that are available in days rather than months," Google said.

Microsoft's new Bing search service is the fastest-growing U.S. search engine among the top 10, according to a Nielsen report released Monday.

The total amount of searches on Bing rang in at 1.1 billion for the month of August, a leap of 22.1 percent over July, winning Microsoft a 10.7 percent share of the search engine market.

Google remained in the top spot with a commanding 64.6 percent share, accounting for 7 billion searches in August, a gain of 2.6 percent over July. Yahoo saw its search results drop 4.2 percent for the month to 1.7 billion, earning it 16 percent of the market.

(Credit: Nielsen)

Other players in the top 10 included AOL Search in fourth place with 333 million searches and Ask.com Search in fifth with 186 million searches.

Similar studies have also seen a boost in Microsoft's search business. An August report from ComScore discovered that Microsoft's share of the global search engine market lept 41 percent from July 2008 to July 2009. Bing was introduced in May, taking the place of Microsoft's Live Search.

Earlier this week, Microsoft showed off a "visual search" feature for Bing that returns thumbnail images for at least some search results. Microsoft reportedly will be debuting a Bing 2.0 sometime soon sporting a variety of new features.

Although the conventional wisdom is that the rise of the Netbook is hurting the Windows business, a Microsoft executive said Tuesday that lower-cost laptops can actually be a good thing.

Speaking at an investor conference, general manager Charles Songhurst said that overall, most people buying Netbooks are either multiple PC owners in developed markets or first-time PC buyers in emerging markets.

"From what we see they are incremental," Songhurst said. "They are new scenarios."

Even if that is true, the fact is that Netbooks have been growing in numbers, while traditional PCs have slumped--a shift that has undeniably hurt the average amount of money Microsoft is getting for each copy of Windows.

One of the opportunities, Songhurst said, is if Microsoft can gain additional revenue on high-end PCs, noting that Microsoft has tended to get about $50 in Windows revenue for the standard $1,000 PC. (Microsoft tends not to talk about how much it charges PC makers for Windows, so it was interesting to hear him mention that figure a couple of times during his chat, which was available as a Webcast.)

Songhurst

(Credit: Microsoft)

Asked about Google's forthcoming Chrome OS, Songhurst said that while it could be a threat if it is demonstrably better, just being cheaper won't offer much of a threat, saying the quality of Windows 7 will help the company fend off new competition. Microsoft plans to launch Windows 7 on October 22, while Google's Chrome OS is not expected until next year.

As for whether Apple might gain ground inside corporations, Songhurst said that Apple isn't winning over the key executives that make technology purchases, such as chief information officers.

"If they are not compelling to the CIO, they are not going to make inroads in the enterprise," he said.

On the Bing front, Songhurst acknowledged that even if Bing is getting good results in the U.S., the company faces an even larger hurdle in the global market, where Google has nearly 70 percent share. Songhurst said that although Bing's engine is available globally, it has yet to put the same kind of marketing dollars overseas as it has in the U.S.

"That marketing push makes a (big) difference," Songhurst said.

One of the other things Microsoft has done is sign deals with companies such as Hewlett-Packard and Lenovo to make Bing the default search engine on new PCs. Asked if Microsoft is eying more such pacts, Songhurst said yes.

"Always we'll do distribution deals for Bing," Songhurst said. "We're quite active in getting out and competing for those."

Microsoft has responded swiftly to suggestions that its Bing search engine seems to throw up ads alongside the keyword "pornography".

In a post Thursday, I outlined some of the suspicions that surrounded the appearance of ads for Bing next to searches for fleshy entertainment.

A Microsoft representative declared in an e-mail: "Microsoft has not purchased the keyword 'pornography,' and this term has never been in our AdWords account."

This will serve as a considerable relief to many upstanding citizens.

I searched 'pornography' on Flickr and this picture is what I got.

(Credit: CC Kessiye/Flickr)

The company representative continued: "It is our policy on the Bing marketing team that we do not have any adult content as part of any of our keyword buys or other marketing campaigns."

However, Microsoft has vivid views about how this alleged relationship between "binging" and films featuring somewhat less talented actors naked might have come about.

"The keyword that seems to be triggering these results is 'free videos,'" the Microsoft representative explained. "We are following up with Google to understand why this ad is showing up in these types of queries."

That should be a very interesting conversation. One looks forward to reading a transcript.

Kai-Fu Lee, the president of Google's Greater China operation and the subject of a bitter employee custody battle between Google and Microsoft, will leave the search giant later this month.

Lee, who left Microsoft in 2005 to take over Google's operations in China, is resigning from the company to start his own venture and will be succeeded by a Google employee, the company confirmed Thursday evening. Lee's departure was first reported by the Wall Street Journal.

"With a very strong leadership team in place, it seemed a very good moment for me to move to the next chapter in my career," Lee said in a statement announcing his departure.

Kai-Fu Lee

(Credit: Google)

An expert in speech recognition technology, Lee founded Microsoft's China research lab in the late 1990s and worked at Silicon Graphics and Apple before joining Microsoft. Before joining Google, Lee had been working at Microsoft's Redmond, Wash., headquarters, focusing on new search technologies.

Google announced in July 2005 that it was hiring Lee, and Microsoft immediately filed suit in Washington state court against Lee and Google, arguing that Lee was violating a one-year noncompete agreement that was part of his Microsoft contract. Google later countersued in California court. Microsoft settled with Google in December 2005, without releasing terms of the pact.

Google put Lee in charge of its search efforts in China, with hopes of democratizing data in China. However, some three years after launching its efforts in China, the search company is still mired in an uncomfortable working relationship with government censors.

(Credit: Dong Ngo/CNET)

It'll probably still be a long time before people start saying things like "I'd spend some time binging that guy before I go on a date with him," but in the U.S. things are looking up for Microsoft's new search engine, Bing, which was unveiled in May.

Web analytics firm StatCounter released analysis Monday stating that Bing slightly increased Microsoft's share of the U.S. search market in July. It now claims 9.41 percent, up from 8.23 percent in June.

The combined market share of both Microsoft and Yahoo in July was 20.36 percent, up slightly from 19.27 percent in June. The commanding lead Google currently has on the market shrank slightly to 77.54 percent in July from 78.48 percent in June.

Microsoft and Yahoo reached a deal last week, with Microsoft powering Yahoo search while Yahoo becomes the exclusive worldwide relationship sales force for both companies' premium search advertisers.

And according to StatCounter analysis, worldwide is the place where the two companies face an even bigger challenge in the search market. In July, Microsoft and Yahoo combined had just 8.77 percent of the global search market, down from 8.45 percent in June. On the other hand, Google still dominates the search market globally with 89.23 percent in July (slightly down from 89.8 percent in June).

StatCounter's data was based on an analysis of 1 billion search engine referring clicks (of which 258 million were from the U.S.) that were collected in June and July from the company's network of more than 3 million Web sites.