The intellectual property business is all about control.  And Google is directly challenging that control by not only circumventing existing distribution channels, but they are doing it without permission of any kind.

MSN Logo 

To make things even more interesting, Microsoft has announced that they will be starting a book searching feature of their own.  Since openly declaring war on Google with the launch of the new, in-house-built MSN Search, Microsoft has not gained much – if any – ground on the search leader, much to the irritation of the largest software company in the world.

If we look at an abbreviated release calendar of MSN product releases, the impatience of Microsoft’s executives is almost palpable:

MSN Product	Launch Date
New MSN Search	February
MSN Messenger 7	April
MSN Desktop Search	May
MSN Local Search	June
Virtual Earth	July
New Hotmail “Kahuna” Beta	July
New MSN Shopping Beta	July
New MSN Money Beta	August
MSN merges into Windows division	September
MSN Book Search Announced	October

 Comparing the earnings growth from the most recent Microsoft quarterly earnings release, September 30, with that of Google’s:

Quarterly Revenue Growth 

If we now consider that two key Microsoft executives left on October 24, days before the earnings release, it is clear that Bill & Co. want results.  Now that Microsoft has realigned the development of the upcoming Windows Vista and the Xbox 360 is almost out of the gate, Microsoft appears to be devoting much more attention to web search.  In September, as part of a major restructuring, Microsoft’s MSN unit was merged into the Windows Client division – a move very reminiscent of past Microsoft maneuvers.  You may remember another company, Netscape, which no longer exists, as a direct result of the integration of Internet Explorer into the Windows Client division.

Following this announcement, Microsoft announced last week that it intends to produce a book search feature to further bolster its MSN Search product.  When combined with the already built-in Encarta Answers feature, and Google’s pending lawsuits, MSN Search could pose a real threat.

Although there have been a lot of rumors recently about the danger to Microsoft posed by Google, I think it is important to realize that Microsoft is probably a much bigger threat to Google than Google is to Microsoft.  Microsoft has a very large and diversified product portfolio, whereas Google’s revenue comes almost exclusively from its Web search products.

There is nothing to stop Microsoft from building MSN search into every copy of Windows Vista – which will be preinstalled on virtually all PCs when it is released in 2006.  Moreover, there is nothing to prevent Microsoft from creating product tie-ins between existing productivity software and MSN.

This is not to say that users will necessarily use the default software on their computer, but it is certainly a possibility.  A number of comparative, blind studies have been performed which show that the “average” user is able to find no significant difference in search quality between Google, MSN and Yahoo.  Along these lines, it is reasonable to assume that if users do not have a preference, they will use whatever is easiest and most available.

In the end, though, the winner is the consumer.  Not only are Google Print and MSN Book Search free, they will both undoubtedly revolutionize the way we locate information.  At the moment, the Internet is an island of information that is cut off from the majority of existing information.  With these added print services, the Internet will finally be more than “just a bunch of webpages.”