Google and Microsoft jostle for desktop position
Published: 24 May 2004 10:50 BST
Google faces a difficult task if it tries to transplant its successful Web search business to the desktop.
The company is reportedly preparing to release downloadable software that enables people to search for text and files stored on their computer's hard drive. The move would dramatically expand Google's search business beyond the Web while taking direct aim at Microsoft, which is itself getting ready to take on Google's dominance in Web search with its own technology.
"It's clearly a pre-emptive move," said Richard DeSilva, a senior associate partner at venture firm Highland Capital.
Although Google would not confirm the existence of the project, called "Puffin," industry watchers have expected such a move for some time. Having announced plans last month for a $2.7bn (£1.5bn) initial public offering of its stock, Google is accelerating efforts to increase revenue and expand into new markets on a number of fronts.
By broadening into desktop file search, Google would put two businesses to the test. First, it would expand its Web-search advertising -- its primary source of revenue, with sales of $914m last year -- to an ad-supported application running on the desktop. That would put Google much closer to controversial companies such as Claria (formerly Gator) and WhenU, which have been caught up in a growing consumer backlash against "adware" and "spyware" products.
Second, Google would take what it's learned in building an enterprise search application and bring it to the masses. That's no easy task, considering that Google failed to storm the enterprise search market when it introduced the Google Search Appliance in September 2002. The product makes up a fraction of its business.
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