If this is really true, it's significant and it's one more proof that Microsoft has no choice but to regard Google as the "new Netscape".

From John Battelle's Searchblog: MSFT Hints at Future Search Strategy:

QUOTE

At the Goldman Sachs internet conference today in Las Vegas, MSN search chief Yusuf Mehdi let slip some of MSFT's plans with regard to search. How do I know he let slip? Well, far as I knew, this stuff was not to be disclosed for quite a while (recall that I was briefed recently by MSFT, on background, for my book).

The news: Microsoft will be including a pretty significant local PC search function as part of its upcoming beta. Mehdi also mentioned that personalized search will be a significant focus going forward, and that MSFT is looking at integrating ads into mail a la Gmail.

UNQUOTE