Google-AOL Deal Raises Stakes

Opinion: Google outmaneuvers Microsoft for 5 percent share in America Online, adding fuel to the fire that burns between the two tech giants.

Can the feud between Microsoft and Google grow any hotter? You bet. Heading into the close of the year, the pair volleyed for some gain in industry mind share, and, by all accounts, the Mountain View team looks to have scored some points.

The big knock to Microsofts pride came with the announcement that Google will take a 5 percent position in AOL, and AOL will continue with Googles online advertising technology for another five years.

Through the fall, Redmond was reportedly on track for the deal. The hope was that AOL would bring some credibility to Microsofts Internet ad venture and boost the traffic to the portal.

But last-minute objections by Time Warner shareholder Carl Icahn were passed over, and the deal went gold to the tune of $1 billion. Icahns 3.1 percent share evidently wasnt enough to stem the Google tide.

/zimages/2/28571.gifClick here to read more about the Google/AOL deal.

Meanwhile, the tit-for-tat slapfest continued over other online services. Microsoft recently went crazy mailing invitations for the forthcoming Windows Live Mail and Windows Live Search for Mobile services.

The beta for its VOIP-centric Windows Live Messenger was also released. However, on the very same day Microsofts beta invites started going out, Google launched Gmail Mobile.

Now, Gmail Mobile is supporting relatively few cell phones and PDAs—and only in the United States. But wider coverage is coming soon, Google claims. And you can get Gmail Mobile on your BlackBerry, too. Still, it all makes Redmond look flat-footed. But tomorrows another day and another announcement, right?

While were on the subject of mobility, we now know the next version of Windows Mobile, dubbed Photon, is on the drawing board. The successor to "Magneto," aka Windows Mobile 5.0, Photon is expected to be a single operating system that will power both smart phones and Pocket PCs. More information to come.

Triple-dot madness

No new features? msdn subscribers found a refreshed Beta 1 build of its WinFS code ready to download, but with no new features.

So wheres the beef? The refreshed build supports .Net Framework 2.0 and Visual Studio 2005 ... Microsoft is planning to add 3,000 India-based jobs to the total company head count in the coming months.

For more on Microsoft and Mary Jo Foley, check out Microsoft Watch at

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