Microsoft Inks Search Deal with HP

Microsoft's Live Search will be the default search engine on HP PCs sold in the U.S. and Canada in 2009...and they'll come with a Live Search toolbar pre-installed.

Looking to expand its share of the Internet search market, Microsoft has announced a deal with top computer maker Hewlett-Packard to make Windows Live Search the default search engine on HP consumer PCs shipped in the U.S. and Canada beginning in January 2009. The PCs will also include a Live Search-enabled toolbar based on Microsoft’s Silverlight technology.

“This agreement with HP is a strategic indicator of our increased focus on securing broad-scale distribution for Live Search,” said Microsoft’s president of platforms and services Kevin Johnson, in a statement. “This is the most significant distribution deal for Live Search that Microsoft has ever done, and we are very pleased to be partnering with HP to help bring Live Search to millions of consumers across North America.”

Microsoft will build the custom Live Search toolbar for HP, and says it will include customization capabilities and integrate with HP services such as Snapfish and HP customer support.

The agreement is an effort to expand Microsoft’s share of the Internet search market; now that the company has abandoned its $45+ billion offer to take over Yahoo (which occupies a distant second place in the search market behind Google), the company is under pressure to draw new eyeballs to its existing search services in order to increase its appeal to online advertisers. Microsoft already has a similar deal in place with China’s Lenovo; a deal with HP could significantly expand Live Search’s reach to new computer buyers, since HP is currently the top PC maker in the world. According to Angus Norton in Microsoft’s Live Search group, about 40 percent of Web users stick with whatever search engine is set to the default for their browser or PC.

For its part, Google has deals which make it the default search engine in the Firefox and Safari browsers, as well as a deal with computer maker Dell to put the Google toolbar on its consumer PCs.

The agreement will also mark a major distribution shift for Microsoft’s Silverlight technology, which competes with Adobe’s Flash technology as a means to add media and interactivity to Web pages. Silverlight has so far has garnered comparatively little traction amongst consumers.

Financial terms of Microsoft’s deal with HP were not disclosed.