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Titans Battle for China: Google Countersues Microsoft

Google yesterday asked a California Superior Court judge in Santa Clara County to invalidate what it said was an "overreaching and unlawful" noncompete agreement - central to Microsoft's lawsuit against former vice-president Kai-Fu Lee, who was hired by Google to head its new research center and operations in China - reports ZDNet (Reuters).

Google contends that the clause violates California laws giving workers the right to change jobs, writes Business Week (AP), quoting Nicole Wong, Google's associate general counsel, as saying that Microsoft's restriction is "clearly an illegal restraint of trade…Google is trying to create an environment for innovators. Microsoft is focused on litigation and intimidation."

Search giant Google is a growing competitor of software giant Microsoft - which is threatening to threaten Google in the search arena.

Microsoft sued Lee earlier this week in Washington, its home state, alleging he violated his confidentiality and noncompete agreements by agreeing to take the job with Google.

China is proving the next great internet market - and battleground - for the two titans, which are apparently prepared to battle for it, starting in U.S. courts, writes CNET. China's online-user population is second only to that of the U.S., and analysts believe it will surpass America's within five years.

China's internet economy, including sales from e-commerce and advertising, has room to grow - it's worth about five percent of the U.S. Internet economy, according to analysts at Piper Jaffray, who expect Chinese interactive sales, including online advertising, e-commerce, games and wireless, to be worth $1.38 billion in 2005. Next year, sales are expected to grow 37 percent to $1.9 billion.

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