Microsoft, News Corp. Discuss Locking Out Google

Microsoft and Rupert Murdoch's News Corp.—which owns such high-profile news agencies as Fox News and The Wall Street Journal—recently discussed an alliance that would counter Google's fledgling online news service. These talks are at an early stage, according to sources. And it's currently unclear whether they're ongoing.

Under the proposed terms of the deal, Microsoft would pay News Corp. an undisclosed sum to have its various news agencies removed from Google News and appear exclusively on Microsoft Bing. Mr. Murdoch has been quite vocal about Google's use of news from his services in recent years and has expressed concern that Google is essentially getting something for nothing. Murdoch is planning some sort of model in which readers pay for his content online regardless.

The benefits of a deal with Microsoft are, perhaps, even more obvious. Microsoft and Google are locked in numerous battles across the online landscape, with each company trying to wrest various markets from the other. So far, Google tends to dominate the purely online services whereas Microsoft still handily beats Google in the enterprise and desktop PC and server markets. To gain ground on Google online, Microsoft has been investigating various alliances, including a 10-year search deal with Yahoo.

And although the news that Microsoft might be colluding with another company to take on Google naturally raises comparisons with the software giant's antitrust-related activities of a decade ago, it's worth noting that a News Corp. linkup would have no such ramifications. This time around, it's Google and not Microsoft that controls the broader (online) market in question, and in the case of online news specifically, there's no clearly dominant player.

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