Lenovo: Microsoft trumps Google

Microsoft Corp. and Lenovo have inked a global agreement to pre-load Windows Live services on Lenovo PCs sold worldwide including ThinkPad notebooks, ThinkCentre desktops and Lenovo-branded PCs:In the coming weeks, Lenovo will be the first PC maker to provide its customers worldwide with immediate access to the Microsoft Live.

Microsoft Corp. and Lenovo have inked a global agreement to pre-load Windows Live services on Lenovo PCs sold worldwide including ThinkPad notebooks, ThinkCentre desktops and Lenovo-branded PCs:

In the coming weeks, Lenovo will be the first PC maker to provide its customers worldwide with immediate access to the Microsoft Live.com portal and Windows Live Toolbar for a more integrated and personalized Web experience as they work, communicate and conduct their day-to-day activities, Microsoft announces.

Steve Berkowitz, senior vice president of the Online Services Group at Microsoft:

Building strong partnerships is a key element of the Windows Live strategy. Working with a globally scaled PC maker like Lenovo, we can help millions of people worldwide use Windows Live services to connect to the people and information they care about most.

Microsoft Senior Product Manager Justin Osmer, as cited by Bloomberg, said the Lenovo deal is exclusive for several years. Lenovo had included Google's search tool-bar program on some of its machines, Peter Gaucher, executive director for strategic alliances at Lenovo said, according to Bloomberg.

Terms of the Microsoft-Lenovo partnership are not disclosed, but Osmer indicated:

The company is avoiding deals that require it to spend too much in exchange for promoting its search software. Microsoft ended negotiations with Dell over a search partnership because Dell wanted too much money.

"We are not in the business to lose money hand over fist, year after year, so these have to make fiscal sense to us. The Dell example is one where it ballooned to a point where it did not make any sense to play in that sandbox, so we let that one go."

Google is apparently happy to play in the (expensive) Dell sandbox.

Wall Street reception of Google’s Dell distribution deal was mixed, according to Citigroup analyst Mark Mahaney:

It was partially perceived as a significant negative development for Google, a step up in its operating expenses and a defensive move against pending competition from Microsoft in the form of the integration of search into Windows Vista and the tighter integration of search into Microsoft’s new browser, IE7.

Google's feared Microsoft competition is no longer pending, it is real. SEE Google warns of Microsoft, Yahoo competition

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