By: Billy Fisher

Contributor, Stock Traders Daily

(La Jolla, CA) Despite any past efforts of executives at Google (Nasdaq: GOOG) or Microsoft (Nasdaq: MSFT) looking to downplay talks of a rivalry, the relationship between these two tech giants is turning into a gun battle.

On Friday, The Wall Street Journal reported that Microsoft, Amazon (Nasdaq: AMZN) and Yahoo (Nasdaq: YHOO) have joined a coalition that is looking to challenge a settlement that Google reached last fall with the Authors Guild and the Association of American Publishers. The settlement which is subject to court approval allows Google to utilize scanned material in its digital books service.

The coalition is sparing no expense in attacking this settlement. It has hired Gary Reback, an attorney who was involved in the Department of Justice’s antitrust investigation of Microsoft in the late 1990s.

The coalition is hoping to have the settlement revised as critics have raised the concern that Google would have an unfair advantage in setting the price of library books after they become digitized and uploaded to the Internet. In consideration for the material usage, Google has agreed to share revenue from ads and subscriptions with the copyright owners.

The rivalry between Google and Microsoft obviously runs much deeper than a book deal. It has been picking up more steam in recent months. In late May, Microsoft launched its new Bing search engine in a revitalized effort to snatch away search engine market share from Google. Then in July, Google countered by announcing that it has a surprise of its own in store for Microsoft. 

Google gave notice that it is now working on developing its own operating system that it plans to have on netbooks in 2010. Previously, most consumer computers have been driven by operating systems developed by Microsoft or Apple (Nasdaq: AAPL). Google plans to market its Chrome operating system as being faster and smoother than its competitors.

It is difficult to predict the eventual outcome of the Google book deal, or where this fight might spillover to next. It is fairly obvious though that these two combatants will be locking horns for some time to come, regardless of the arena. Stay tuned.

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