The rivalry between Microsoft and Google is getting fired up over software and services and has become so hot that it is spilling into the legal and regulatory realm, according to some observers.

The latest shot is coming from Google, which according to a Wall Street Journal article is making antitrust claims concerning Vista and desktop search software.

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Google’s complaint comes on the heels of Microsoft’s call for federal regulators to investigate Google’s recent acquisition of online advertising firm DoubleClick.

The tit-for-tat is starting to reveal that competition is getting white hot, but it might not be in the area everyone is looking at, according to some observers.

“Google’s CEO [Eric] Schmidt is on record saying Google would focus on search, ads and apps and I think apps is the Achilles’ Heel part of it,” says Guy Creese, an analyst with the Burton Group. “It is clear Google wants to do more than just search, they want to get into the enterprise space and I think that will be the Waterloo.”

Others say this competition is getting so intense that all the gloves are off.

“The competition has spilled over to the legal and regulatory process,” says Greg Sterling, founding principal of Sterling Market Intelligence, a consulting and research firm.

Back and forth . . . Google has gone the antitrust route on Microsoft, according to a story in The Wall Street Journal. In a filing that has yet to be made public, Google apparently has raised issues with the way Windows Vista handles desktop search software. Google says... Microsoft says... Microsoft has violated the consent decree from the 2002 antitrust settlement. Talk to our lawyers. Vista isn't playing nice with rival desktop search engines. Lawyer-speak filters down to "we didn't do anything wrong." Microsoft search engine slows Google search engine when both running on a PC. Microsoft search can be shut down, but it is difficult.

Click to see: Google says, Microsoft says...

“They are serious rivals and they are taking every opportunity to secure some advantage and to point out where there is some unfair advantage. That is probably what Google is doing here and what Microsoft is doing with DoubleClick. They are sort of mirrors of one another. “If this model of complaining back and forth through the regulatory bodies comes routine, it will certainly add a different flavor to all this stuff.”