Microsoft has reached a deal with Yahoo! for an internet search partnership, ending years of back and forth negotiations.

The 10-year deal announced on Wednesday gives Microsoft access to the internet's second-largest search engine audience, adding a potentially potent weapon to the software maker's internet arsenal as it girds for an all-out assault against online search and advertising leader Google Inc.

The extended reach will allow Microsoft to introduce its recently upgraded search engine, called Bing, to more people.

In return for turning over the keys to its search engine, Yahoo! will get to keep 88 per cent of the revenue from all search ad sales on its site for the first five years of the deal, and have the right to sell ads on some Microsoft sites.

In a direct challenge to Microsoft, Google announced late Tuesday that it is developing an operating system for PCs based on its Chrome web browser, New York Times reported.

The move sharpens the already intense competition between Google and Microsoft, whose Windows operating system controls the basic functions of the vast majority of personal computers.

In a post on its company blog, Google said the operating system would initially be aimed at netbooks, the compact, low-cost computers that have turned the PC world on its head. It said the open-source software, called Chrome OS, would be available in the second half of next year.

“Speed, simplicity and security are the key aspects of Google Chrome OS,” the blog post said. “We’re designing the OS to be fast and lightweight, to start up and get you onto the Web in a few seconds.”

Google has already developed an operating system for mobile phones, called Android. And several manufacturers of netbooks are also using that software.

Source: Gulfnews

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