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February 7, 2006

Dell testing preinstalled Google software package

Posted by David Hunter at 2:28 PM ET.

Confirming the rumor from January, Eric Auchard has the story for Reuters:

Dell Inc. and Google Inc. confirmed on Tuesday they are testing a pre-installed package of Google software on Dell computers, in a potential blow to Microsoft Corp.’s dominance of desktop software.

Bob Kaufman, a spokesman for Dell, the world’s leading personal computer maker, said his company is evaluating Google Inc. software that PC customers could use to search both the public Web and for local information stored on their PCs.

“We can confirm that we are running a test with Google that could include a Google-powered Dell home page, Google desktop search and a Google Toolbar,” Kaufman told Reuters.

“We are conducting a test of distribution of some of our software via Dell,” Google spokesman Jon Murchinson said.

More by following the link including other hardware vendors that are already bundling the Google toolbar.

Update: Robert A. Guth and Kevin J. Delaney provide an admirable tutorial in the economics and politics of preloaded software at The Wall Street Journal. With reference to the Google deal with Dell:

Under the deal being discussed, Google, of Mountain View, Calif., could pay Dell fees approaching $1 billion over three years, these people estimate.

Under a scenario Google and Dell are discussing, Dell would set up PCs to run a few Google products straight out of the box, including software to search PC hard drives and its toolbar browser.

This fall, Dell, the world’s largest PC maker, set up a competitive bidding process for Internet companies who wanted the right to load their software on as many as 100 million new Dell PCs. Yahoo pulled out of the running, and then Google beat Microsoft, say people familiar with the matter. Microsoft wouldn’t comment on the bidding.

That’s just the economics and just Dell. HP is also mentioned specifically, and all the PC makers are involved in the politics of trying to exercise their freedom to choose preloaded software that was won from the antitrust case over Microsoft’s attempts to restrict Netscape from the desktop. It apparently still requires a lot of negotiation with Microsoft by both the hardware and software vendors as the article details.

Filed under Coopetition, Dell, Google, HP, Yahoo

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2 Responses to “Dell testing preinstalled Google software package”

  1. Microsoft News Tracker » StarOffice behind big Google Dell deal? Says:

    [...] Yesterday’s story that Google was planning to pay Dell $1 billion dollars to install software on the new PCs they ship hit Google’s stock: Google shares were down 5 percent, or $19.23, to $365.87 in afternoon trading on Nasdaq. Analysts cited concerns that the Web search company was prepared to dramatically increase the cost of acquiring new customers by agreeing to pay huge upfront fees to win deals with PC makers. [...]

  2. Google gets prime position on Dell PCs -- Microsoft News Tracker Says:

    [...] It will also be installed on certain enterprise systems, unless the buyer specifies its own corporate software tools. Dell will begin shipping the new configuration by the end of May. No financial terms were announced, but the original rumor had Google paying Dell $1 billion over three years. [...]

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