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The first fruit of the new relationship is that both companies will distribute each other's software. Under the agreement Sun will include the Google Toolbar as an option in downloads of the Java Runtime Environment from Java.com, Sun's developer resources for Java technology.

Although this may sound like small potatoes, the effect of the agreement may have far reaching consequences. The companies have promised further collaboration on projects like OpenOffice.org, the open source productivity suite promoted as an alternative to Microsoft Office, for Sun's own Solaris operating and Linux. OpenOffice also forms the basis for StarOffice 8 launched this week.

'Google has long been part of the Java

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technology ecosystem, and today's announcement highlights this relationship,' observes Mark Herring, Sun's director of Java Brand and Community Marketing.

The news is unlikely to go down very well in Redmond. Although Sun and Microsoft have professed themselves to be the best of friends, relations between Google and Microsoft have been frosty at best following the defection of a key employee earlier this year.

The suspicion at Microsoft must be that the promotion of Google to the Java top table, the collaboration on OpenOffice and the search engine's own ambitions to offer services from webmail to VoIP to instant messaging means that Google intends to create a Java-based office productivity application driven from the browser.

The prospect of a web-based productivity suite which runs on the desktop but which connects to network services is the Microsoft nightmare, raised by Netscape many years ago. It would not only eat into Redmond's dominance in the office productivity market but would threaten to bypass the whole basis of Windows itself. A similar rumour in the mid 1990s prompted Microsoft to bring its full weight down to crush the upstart then. With an antitrust suit and a much larger competitor, Microsoft may not find it so easy next time.