Microsoft CEO laughs off Google OS challenge

SEATTLE Tue Jul 14, 2009 2:41pm EDT

Microsoft CEO Steve Ballmer delivers a speech during a session at the International Advertising Festival, Cannes Lions 2009, in Cannes southern France, June 24, 2009. REUTERS/Alain Issok

Microsoft CEO Steve Ballmer delivers a speech during a session at the International Advertising Festival, Cannes Lions 2009, in Cannes southern France, June 24, 2009.

Credit: Reuters/Alain Issok

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SEATTLE (Reuters) - Microsoft Corp's (MSFT.O) chief executive attempted to laugh off the challenge of Google Inc's (GOOG.O) planned computer operating system on Tuesday, conceding only that it was "interesting".

"I will be respectful," Microsoft CEO Steve Ballmer said to laughs from the audience at a conference for the company's technology partners in New Orleans, which was broadcast over the Internet.

"Who knows what this thing is? To me, the Chrome OS thing is highly interesting," said Ballmer, choosing his words carefully and drawing more amusement from the largely pro-Microsoft crowd.

"It won't happen for a year and a half and they already announced an operating system," he added, referring to Google's Android system for smartphones.

Last week Google said it was planning a computer operating system based on its Chrome browser, aiming directly at the core business of Microsoft, the world's largest software company, whose Windows operating systems are used on more than 90 percent of personal computers.

Google's plan, based on the theory that access to the Internet is now the most important feature of any computing device, would be separate from its Android system already available for smartphones and soon for small PCs.

"I don't know if they can't make up their mind or what the problem is over there, but the last time I checked, you don't need two client operating systems," said Ballmer. "It's good to have one."

Despite the jovial tone of Ballmer's public remarks, Microsoft is taking Google's challenge seriously. Its new Bing search engine is a concerted attempt to take market share from dominant leader Google, and its announcement on Monday that it would offer some versions of its Office application on the Internet is a swipe back at Google's move into free, online software.

Ballmer's previous attempts to make light of new competition have not always been successful. He also derided Apple Inc's (AAPL.O) iPhone as too expensive, but it went on to take a significant share of the smartphone market.

Microsoft shares fell 15 cents to $23.08 on Tuesday afternoon on the Nasdaq.

(Reporting by Bill Rigby, editing by Matthew Lewis and Gerald E. McCormick)

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