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The search giant had complained to the anti-trust authorities in the US and Europe that Microsoft planned to make its own search the default option on the new Internet Explorer 7.

The DoJ says it had been working with Microsoft to address any concerns over anti-trust implications with IE7 since before any code was released to the public. In the latest report on Microsoft's compliance with anti-trust rulings the DoJ concludes that: 'In this upgrade situation, Internet Explorer 7 preserves the user's existing search engine default or else uses MSN Search if no default has been set. As Microsoft's implementation of the search feature respects users' and OEM's default choices and is easily changed, (The DoJ) have concluded their work on this matter.'

However, this is unlikely to

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be the end of the matter. Google maintains that while it may be easy to change the default, by sheer inertia, new versions of IE 7 shipped with the Vista operating system will automatically boost Microsoft's market share of search.

While Internet Explorer still has close to 90 per cent of the PC browser market, its share of the search market is languishing well behind that of Google. A recent survey of the search business in the US puts Microsoft's market share at around 11 per cent.

Elsewhere in the report, Microsoft is given a further two year extension before final judgement is given in the anti-trust action. The DoJ says it is necessary to extend the term of certain portions of the Microsoft final judgment by at least two years. The Department said it was necessary due to Microsoft's difficulty in improving the technical documentation it provides to licensees of its communications protocols.

This apparent leniency is in contrast to the attitude of the European Union that is pursuing similar remedies to the US. In a letter to Microsoft, the EU quotes industry experts on the Microsoft documentation as variously 'entirely inadequate', 'devoted to obsolete functionality', 'self-contradictory' and written 'primarily to maximise volume (page count) while minimising useful information.'

It is likely that Google will now press its case with the EU in the hope of getting a more sympathetic hearing.