Microsoft Strikes Web Search Deal with Sun

SEATTLE (Reuters) - Microsoft Corp. said on Monday that it reached a Web search deal with Sun Microsystems Inc., the latest partnership struck by Microsoft aimed at chipping away at the dominance of Google Inc.

As part of this agreement, users of Microsoft's Internet Explorer browser who download Sun's Java technology platform will be given the option to also download the MSN Toolbar from where users can directly access the company's search engine.

Earlier this year, Microsoft also reached an agreement with Hewlett-Packard Co, the world's largest personal computer maker, to place a toolbar on new PCs in the United States and Canada starting in January.

"This deal will expose Live Search to millions more Internet users and drive increased volume for our search advertisers," said Yusuf Mehdi, senior vice president of the Online Audience Business at Microsoft, in a statement.

Striking distribution deals are one part of Microsoft's strategy to close the gap on market leader Google. Microsoft said competition for these types of deals is intense and that the company had to outbid several rivals for the Sun deal.

Sun said the Java platform sits on more than 800 million personal computers around the world, or on 91 percent of Internet-connected PCs worldwide. The Java Runtime Environment is downloaded tens of millions times every month, Sun said.

Google's U.S. Web search market share reached 63 percent in August versus a 19.6 percent for Yahoo Inc and 8.3 percent for Microsoft, according to comScore.

(Reporting by Daisuke Wakabayashi; Editing by Gary Hill)