The fight is on between the three internet search titans, after Yahoo’s Terry Semel laid down the gauntlet to Microsoft saying the software giant’s recently elevated ambitions in the search arena were a lost cause.

“My impartial advice to Microsoft is that you have no chance. The search business has been formed,” he said in an interview with the New Yorker’s Ken Auletta (Watch video footage here and read Jeff Jarvis’ immediate blog reaction here).

“Very cool” said one blogger, adding “Microsoft just does not seem to be getting much love these days”.

“That crashing sound you hear, is a chair being thrown across an office in Redmond,” said another.

And if Bill Gates and co were smarting at that taunt, the hurt must have been exacerbated by the fact that Microsoft been hoping to get Mr Semel’s company onside in its greater fight to win market share from Google, the dominant force in the lucrative sponsored search market.

Mr Semel, who spoke about his own regrets at not buying Google, flatly denied there had been any talks about Microsoft buying Yahoo and said he had rebuffed an offer to buy a stake in the search business.

“I will not sell a piece of search - it is like selling your right arm while keeping your left; it does not make any sense.”

Last week Microsoft raised its ambitions in the internet search arena when it announced it all advertising on MSN in the US, France and Singapore would be powered by its own AdCenter system, thus dispensing with ads generated by Yahoo.

But Microsoft had been hoping that its partnership with Yahoo might lead to something altogether more meaningful. It will be interesting to see how the spurned suitor reacts.

Google gets seriously systematic

Meanwhile, Google denied it was responding to Microsoft’s challenge when it said it would divert more resources into developing search technology.

In another sign that Google is growing up, the technology group formerly known as fun said it had also introduced a more “systematic” approach to management and announced a string of search-related products to prove “yes, we are still all about search”.

After a long period of diversification, which has seen Google branch into a range of activities including instant messaging, wi-fi and classified ads, the company said that the proportion of R&D dedicated to search had fallen below its long-running 70 per cent target.

In a world of Google Earth, Blogger, Writely, Picasa, Hello, Gmail, and Google Talk, it’s easy to forget that Google is ultimately a search engine,” commented chad78 on

The company, renowned for allowing engineers time to pursue new ideas, said it would now ”encourage” its development staff to readjust the balance towards its core search business.

Game consoles square up on price

The big news at the E3 video games show was the Sony Playstation 3 price - $499 with a 20GB hard drive or $599 with 60GB; or about $100 more than the comparable Xbox 360 models. Sony says the fact that it’s “the best” and has a Blu-ray high-definition DVD player makes it all worthwhile. Nintendo, meanwhile, is expected to price its Wii at between $200 and $249 in its mission to reach the highly sought-after market of “casual gamers” and even “non gamers”. This elusive category of potential gamers - women, small children, older people - are probably less likely to fork out quite so much of their hard-earned cash as the traditional gaming market of young men.

E3 also saw the debut of the Wii, with its ambitious controller that can be moved around in 3D space. Engadget interviewed Shigeru Miyamoto, the legendary creator of Donkey Kong, Mario and Legend of Zelda, and asked the question that had to be asked: what if gamers are too lazy to go along with these active shenanigans?

Joystiq tried an early version of the controller and gave it a mixed review, along the lines that it seems better with some games than with others. They also had high resolution shots of the PlayStation 3.

Nintendo fans are nothing if not devoted, as this FT poll indicates: the Wii/Revolution got the least votes but was not short of plaudits such as “watch and see Nintendo pulls up from nowhere and beat down Microsoft”. And this was before they’d unveiled the new name…

Porn domain name ICANNed

ICANN, the US-based administrator of the “root” system that lets a user connect to information on a server held anywhere else in the world, has voted not to set up a new .xxx domain name for internet porn sites.

But the decision has re-ignited a row over the neutrality of the international body, with the European Union fearing that intense lobbying from the US government - under influence from religious and family groups incensed at the “legitimisation” of pornography - may have pressurised ICANN into voting against the move.

But .xxx has not only split nations - even the sex industry can’t decide with some websites objecting on fears that it might make censorship easier.

Unsurprisingly there was a lot of comment on this story, much of it not reaching me through the company firewall, but Michael Bloch on thought .xxx would have been a step in the right direction:

“I really can’t see how, properly enforced, there would have been any losers in a compulsory .xxx strategy in the long term:

- parents would have less to worry about knowing that anything from .xxx domains could be easily blocked

- system administrators would have had an easier job in filtering

- the adult industry would have their own playpen

- those wanting to access adult content would know where to find it

- those operating outside the guidelines would be constantly playing a “dodge the cops” game.

The only possible problem I could envision is determining what constitutes ‘adult content’ - that could be a particularly contentious issue”.

Steven Fettig described ICANN’s decision as “just plain stupid”:

“You aren’t going to rid the net of pornography, period. You would have made it a lot easier for administrators like myself to be able to at least block a whole TLD that we don’t want people to have access to, instead of having to depend on poor software AI to figure out which domains have pornographic content and which don’t. Regardless of my opinion of the state of pornography on the net, this is a lose lose for everyone involved.”

“Shame on ICANN for bowing to what can only be conceived as political pressure,” he added.

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