December 5th, 2008

Microsoft signs major deal with Dell for Live Search

Posted by Mary Jo Foley @ 1:17 pm

Categories: Channel, Corporate strategy, OEMs, Resellers, Search, Windows client, Yahoo

Tags: Google Inc., Dell Computer Corp., Microsoft Live Search, Microsoft Corp., Mary Jo Foley

Microsoft and Dell have signed a deal via which Dell will be shipping new PCs with the Live Search toolbar preinstalled, according to sources familiar with the arrangement between the two companies.

Microsoft officials declined to comment on the alleged deal, as did Dell officials. Officials with both companies said they would not comment on “rumors and speculation.”

I wouldn’t put this in the speculation category, myself. My sources say that Microsoft has offered Dell sweet enough terms to entice the PC maker to replace its search-preload deal with Google with a comparable offering from Microsoft.

The Dell-Google deal, cemented in 2006, called for Dell to preload the Google search toolbar on “millions” of consumer and business PCs. The Dell-Google deal also included a co-branded Dell-Google home page. It’s not clear whether the alleged Microsoft-Dell deal also includes a new home page.

Microsoft has been seeking to land new OEM search deals with various PC makers as a way to grow more quickly its lagging search market share.

In March 2007, Microsoft signed a search-preload deal with Lenovo. Under terms of that relationship, Lenovo agreed to preload Live Search and Windows Live services — delivered via the integrated MSn toolbar — on new Lenovo consumer laptops.

Word of Microsoft’s latest search-preload deal comes a day after Microsoft announced it had hired former Yahoo search expert Qi Lu as the new head of its Online Services business.

OEM deals are just one way Microsoft is looking  to grow its search share. The company also is considering rebranding Live Search with a more verb-like term. The leading candidate is thought to be Kumo.Com.