MSFT in talks with Apple for iPhone placement - outbid Google?

Businessweek reports that Microsoft might replace Google on the iPhone: Apple, Microsoft Discuss Giving Bing Top iPhone Billing

Apple (AAPL) is in talks with Microsoft (MSFT) to replace Google (GOOG) as the default search engine on its iPhone, according to two people familiar with the matter. The talks have been under way for weeks, say the people, who asked not to be named because the details have not been made public.

The discussions reflect the accelerating rivalry between Apple and Google, now the main provider of Web search on the iPhone.

If the deal happens its because Microsoft agreed to outbid Google for prime position on the iPhone. Microsoft might even replace Google on Safari. And why not pay Mozilla for the default search engine spot too?

It's not because of rivalry.

Microsoft is a larger rival than Google. It has a rival OS, it has Zune a potent rival to the iPod; it has a mobile OS that is on many cell phones; it has many competing applications.

If the deal happens its because of money not rivalry.