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Originally published Wednesday, September 3, 2008 at 12:00 AM

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Restrictions on Microsoft may be plus for browser from Google

Google's new Chrome Web browser, released Tuesday, may get a boost from states' efforts to bar Microsoft from abusing its market dominance...

Bloomberg News

Google's new Chrome Web browser, released Tuesday, may get a boost from states' efforts to bar Microsoft from abusing its market dominance.

Under the terms of its U.S. antitrust settlement, Microsoft can't pay personal-computer makers to keep competing browsers off their machines. While those terms had been set to expire last year, California and five other states won an extension from U.S. District Judge Colleen Kollar-Kotelly in January.

The states sought to lengthen the restrictions to help promote competition in the U.S. software industry.

Google, owner of the world's most popular Web-search engine, is pitting Chrome against Microsoft's Internet Explorer, which has more than 70 percent of the market.

"It's harder for Microsoft to pressure computer makers," said Robert Lande, a professor at the University of Baltimore Law School who worked for the Federal Trade Commission from 1978 to 1984.

"Microsoft still can do indirect things, but it is harder for them, and it's harder when they know that it's Google and they have the muscle to fight back."

The restrictions on the world's biggest software company stem from a settlement negotiated in 2001, when a federal appeals court found Microsoft violated antitrust laws by preventing PC makers from distributing Netscape Communications' Navigator browser.

Unlike Microsoft, Google is free to strike exclusive partnerships with PC makers to get its browser onto their machines.

Google's free browser is being promoted as sleeker, faster and more secure than Microsoft's Internet Explorer. "What we want is a diverse and vibrant ecosystem," Google co-founder Sergey Brin told reporters Tuesday at Chrome's unveiling. "We want several browsers that are viable and substantial choices."

Among other features, Chrome's navigation bar — where you type in an Internet address — will serve a dual purpose. Users can either enter an address or a search request that will be processed through their search engine of choice.

Google bets it will be the default search engine for the majority of Chrome users, helping to build upon its nearly 64 percent share of the worldwide search market.

"You only have 24 hours a day and we would like you to do more searches," Google's other co-founder, Larry Page, said at the unveiling. "If the browser runs well, then you will do more searches."

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Google already has an agreement with Dell to install its search-tool bar on Dell machines. The company probably will seek to get its browser onto them too, said Matt Rosoff, an analyst at Kirkland-based market-research firm Directions on Microsoft.

"Striking deals with computer makers is absolutely what Google is going to do," he said. "Microsoft is constrained from compelling computer makers so they have to be careful."

Sundar Pichai, Google's vice president of product management, declined to comment on Google's plans to attract browser users.

The limits on Microsoft also require the company to make it simple for computer users to set rival browsers as their default choice.

Last week, Microsoft released a test version of Internet Explorer 8 with privacy settings that let users control whether the program tracks and saves the sites they visit.

An optional feature that limits some third-party content on Web sites can block advertisements, Microsoft senior product manager James Pratt said last week. That may hurt Google, which gets almost all its sales from Internet advertising.

Microsoft has already faced complaints from Google on how it designed Internet Explorer 7. After Google told European regulators the program directed people to Microsoft's search engine, Microsoft backed down and agreed to offer users more opportunity to change their settings.

Microsoft on Tuesday played down the threat posed by Chrome, predicting most people will embrace Internet Explorer 8.

"We respect the user's right to choose the browser that fits their needs and do not comment on competitors," Microsoft said in an e-mailed statement.

But Benchmark analyst Brent Williams thinks Microsoft has cause for concern. In a Tuesday research note, Williams described Chrome as a "a new, potentially significant, challenge to Microsoft's Web strategy and to [Microsoft's] core product suite, and indeed to [Microsoft's] business model."

Microsoft shares fell 19 cents to $27.10 Tuesday while Google shares gained $1.96 to $465.25.

Information from The Associated Press is included in this report.

Copyright © 2008 The Seattle Times Company

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