Do Not Track — which aims to help users opt out of being tracked across Web sites for the purposes of targeted advertising — is contentious and still somewhat theoretical. But since Chrome is close to becoming the world’s most-used browser, if it’s not already, its support for DNT is pretty important.

Of all the major browser providers, Google had moved the slowest on Do Not Track, but had earlier this year agreed at the request of the Obama Administration that it would implement DNT.

Google spokesman Rob Shilkin said in an emailed statement, “We undertook to honor an agreement on DNT that the industry reached with the White House early this year. To that end we’re making this setting visible in our Chromium developer channel, so that it will be available in upcoming versions of Chrome by year’s end.”

When Do Not Track is turned on within a browser, a snippet that specifies “DNT:1” is added to the request header whenever a user wants to go to a new Web site. Once Chrome adds this to its full release, that will happen across all major browsers.

But critics say it’s not necessarily clear what sites and advertisers have to do in response to DNT being turned on.

That could be a significant problem, because users will think they’re not being tracked since they explicitly changed a setting (seems like a reasonable assumption!) — but they may just be making a request that can be ignored. Talk about defeating the purpose.

All the Web and advertising players are still sorting out how to deal with this; some, like Google, more reluctantly than others.

For instance, since Microsoft decided to turn on DNT by default in Internet Explorer 10, developers of the Apache Web server are now saying they will ignore Do Not Track requests from IE visitors because it goes against the spirit of DNT being a choice. Also, even though Facebook is doing its own ad exchange, it hasn’t agreed to participate in Do Not Track at all.

Image via Maxthon corporate blog. 

“We take compliance with our decisions very seriously,” EU Competition Commissioner Joaquin Almunia said Tuesday. “And I trusted the company’s reports were accurate. But it seems that was not the case. If following our investigation, the infringement is confirmed, Microsoft should expect sanctions.”

Under the terms of a 2009 antitrust settlement with the European Commission, Microsoft was to present Windows users with a ballot screen offering them an opportunity to swap out Internet Explorer for one of 11 other browsers from rivals like Mozilla, Apple, Opera and Google. And it did do that, initially. But with an update to Windows 7 rolled out in February of 2011, Microsoft eliminated the ballot screen, and didn’t realize it had done so until it was alerted by the EC on July 2.

“Due to a technical error, we missed delivering the Browser Choice Screen (BCS) software to PCs that came with the service pack 1 update to Windows 7,” Microsoft said in a statement. “… While we believed when we filed our most recent compliance report in December 2011 that we were distributing the BCS software to all relevant PCs as required, we learned recently that we’ve missed serving the BCS software to the roughly 28 million PCs running Windows 7 SP1.”

Microsoft says it is scrambling to address the error, and has offered to extend its BCS compliance period by another 15 months to make good on it. But it remains to be seen whether that gesture will fly with the EC. After all, this is not the first time the group has taken Microsoft to task for noncompliance, and Almunia said today that if the EC investigation confirms the company’s failure to comply, there will be “severe consequences.” The EC can impose fines of up to 10 percent of annual revenue.

“This is in my view a very important case to ensure all the citizens and all the companies operating in the market that competition law requires a real serious enforcement,” Almunia said. “[We will] use all legal instruments with all the capacity to deter and to punish.”

In the 5 years since Google released Gmail to the public, for instance, the app has grown to reach 425 million monthly active users. Governmental agencies in 45 out of 50 U.S. states are using Google apps, as well as more than 66 universities and five million businesses across the U.S.

As always, Pichai and the apps team pride themselves on the platform’s collaborative properties. Chrome’s synchronicity across devices, Google docs’ realtime updates, and precious, precious speed: Chrome’s speed, Pichai says, saves more than 13 years of human productivity over the course of a lifetime.

“Try doing that with Sharepoint,” Pichai said.

After years of rumors and leaks, Google Drive finally launched weeks ago, and the app is spreading across platforms fairly quickly. Google Drive hit the 10 million user mark and is slated to appear on iOS and iPad on Thursday, the first appearance on Apple’s mobile platform.

Google is also pushing its Chromebooks, the low-cost, web-focused laptops powered by Chrome OS. The new generation of Samsung Chromebooks launched three weeks ago, touting more powerful specs and faster performance than last year’s generation. Google will soon begin selling Chromebooks in more than 100 Best Buy retail locations across the U.S., continuing to seed the landscape with the fledgling platform. (It also helps that Google will give all the developers attending I/O a free Chromebox.)

And, of course, Pichai and his team continue to push the Chrome browser: Usage of the platform has exploded over the past year, with more than 300 million active users, nearly double the number from only a year ago. That number most likely has nowhere to go but up, considering Google announced it is bringing Chrome to iOS devices beginning on Thursday.

Then there was Google Compute Engine, which takes a direct shot at Microsoft’s Windows Azure, and also at Amazon Web Services. It’s a textbook infrastructure-as-a-service play that shows how readily and quickly Google can scale up and down on demand. There are still a lot of details yet to be disclosed about how the service will work and as yet it’s only for early customers on a trial basis.

But the places where Google and Microsoft are not competing head to head are growing fewer by the day.

The company spent the first 20 minutes of its press conference on major new game releases for the console, such as Madden 12 and Halo 4, to satisfy the crowd. But after a few obligatory game announcements, it turned its focus to a series of entertainment announcements.

The concentration makes a whole lot of sense today, given that more people are using their Xbox to watch video and listen to music online than they are playing multi-player games — for the hardcore gamers out there, sorry, but it’s true.

Microsoft’s Yusuf Mehdi said content partnerships coming to the platform include ESPN, NBA, NHL, Univision, Paramount and Machinima. He also announced a new music service, called Xbox Music, which will feature 40 million new tracks, and work across Xbox, phones and PCs.

While ESPN has been available before, he said this time the sports content will be available 24 hours a day and include SportsCenter, ESPN2 and other favorites. He did not say whether users would also have a cable subscription to access it, which has been the case with content in the past.

Microsoft also announced “Xbox SmartGlass,” which will allow Xbox users to pick up a video on their phone or tablet where they left off on their console. With Xbox SmartGlass, the tablet will also act as a kind of controller for games. For example, Microsoft demonstrated how a gamer can pause Halo 4, check his tablet for the specifications of the gun, then resume the game on the TV.

This integration between tablets and console was expected, but definitely steals a bit of Nintendo’s thunder, which has created a proprietary Gamepad tablet that interacts with its upcoming Wii U console.

And if that wasn’t enough content for the Xbox, Microsoft is also bringing Internet Explorer to the game console. Marc Whitten, who heads up Xbox Live, said people are always asking, “When will you bring the Web to Xbox?”

“No one uses them [browers] because they are painfully slow. But with the intelligence of SmartGlass, Internet Explorer is coming to Xbox this year,” he announced.

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That’s a side component of the $1 billion patent sale that AOL and Microsoft announced this morning. As part of the transaction, AOL announced that it was selling off “stock of an AOL subsidiary” at a loss, in a move that’s supposed to reduce its overall tax bill.

AOL didn’t disclose the name of that subsidiary in its press release, but a person familiar with the transaction has clued me in: It’s Netscape.

Microsoft will buy the underlying patents for the old browser, but AOL will hang on to the brand and the related Netscape businesses, which make up a grab bag of stuff these days: An ISP, a URL, a brand name, etc.

All of which probably makes sense on someone’s ledger books. But the transaction may still make a few heads spin, at least for people who remember Internet history and/or have access to Wikipedia.

IE captured a 53.83 percent share of the worldwide browser market in March, up from 52.84 percent in February. A minuscule gain, but — importantly — one that was won at its rivals’ expense. During the same period, Firefox’s share of the market slipped to 20.55 percent share from 20.92 percent. Meanwhile, Google Chrome’s market share fell to 18.57 percent from 18.90 percent — the third consecutive month it has declined — and Apple’s Safari dropped to 5.07 percent from 5.2 percent.

“With a gain of .99 percent last month and a net gain of 1.2 percent global usage share over the last five months, Internet Explorer has stabilized and even reversed its usage share declines of the last few years,” Net Applications researchers explained.

For IE, which once held well more than 70 percent of the browser market, this turnabout is a welcome trend. Could its slump finally be over?

In a blog post written by Dean Hachamovitch, Microsoft’s corporate vice president for Internet Explorer, the software giant alleges that Google is using similar methods — though the actual bypass mechanism is different — to get around default privacy protections in Internet Explorer and track IE users with cookies.

By default, Microsoft says, Internet Explorer blocks third-party cookies, unless the site presents a “P3P Compact Policy Statement” indicating how the site will use the cookie and that ultimately the site won’t track the users.

“Technically, Google utilizes a nuance in the P3P specification that has the effect of bypassing user preferences about cookies … By sending this text, Google bypasses the cookie protection and enables its third-party cookies to be allowed rather than blocked,” the post reads.

Microsoft said it has contacted Google and asked them to commit to Microsoft’s standard privacy settings for browser users.

In the post, Microsoft also offered a Tracking Protection List that Internet Explorer 9 users can add as a protection, “in the event that Google continues this practice.”

Google has responded by saying that Microsoft has omitted important information in its blog post.

“Microsoft uses a ‘self-declaration’ protocol (P3P) dating from 2002 under which Microsoft asks websites to represent their privacy practices in machine-readable form,” Google’s statement reads. “It is well known — including by Microsoft — that it is impractical to comply with Microsoft’s request while providing modern web functionality. We have been open about our approach, as have many other websites.”

Google went on to point out that in 2010, a research report from Carnegie Mellon University found that more than 11,000 of 33,139 Web sites were not issuing valid P3P policies as requested by Microsoft.

“Today the Microsoft policy is widely non-operational,” Google said.

The Wall Street Journal reported Google’s bypass of Safari’s privacy settings late last week, and after being contacted by the Journal, Google disabled the code that had allowed it to track Safari users. Three U.S. lawmakers have since called on the FTC to investigate the search giant over the privacy gaffe.

(Photo courtesy of Flickr/Si1very)

A few years ago we moved our company completely off of Internet Explorer to Firefox because you wrote in your column that IE had security holes and lacked speed. Our IT Services provider has told us that IE9 has solved all the pitfalls of previous versions, it’s the safest yet, and there are many business-oriented sites that are much friendlier to IE. So is it OK to go back?

A:

I haven’t done a comparative browser review in a while, but I do agree that Internet Explorer has improved tremendously in speed, security and features. I think IE9 is a good browser and a reasonable choice, assuming you are a 100% Windows shop. IE is the only major browser that lacks a Mac version.

Some caveats: Each of the major browsers has improved, and, by some measures, some competitors beat IE in speed. A new, fast-rising contender since I wrote that old column is Google’s Chrome, which I find to be fast and reliable. IE’s market share, while still the highest, has shrunk dramatically and the browser market is more balanced. Finally, the number of business-oriented sites that require or do better in IE has been greatly reduced from, say, five years ago.

Earlier this week, Google and Mozilla said they had struck a deal to renew their search royalty agreement for another three years.

What the pair declined to add: The search giant will pay just under $300 million per year to be the default choice in Mozilla’s Firefox browser, a huge jump from its previous arrangement, due to competing interest from both Yahoo and Microsoft.

Sources said this total amount — just under $1 billion — was the minimum revenue guarantee for delivering search queries garnered from consumers using Firefox.

Google’s main rival in the bid, sources said, was Microsoft’s Bing search service, which was aggressively trying to hip-check it from the main search spot on the browser.

That’s because the software giant has been spending a lot of money in efforts to grow Bing’s market share in the search market.

Microsoft, of course, also owns the still-dominant Internet Explorer browser, but Google’s Chrome has recently been making major gains over both IE and Mozilla’s Firefox.

Still, Mozilla’s recent negotiations with both companies was about search market share.

Yahoo was also in the mix, even though Microsoft powers its search technology, because a hookup with Firefox was considered a plus in holding on to its declining search market share.

But the deal, which was being pushed hard by Yahoo’s Chief Product Officer Blake Irving and its search head Shashi Seth, was determined to be too costly for Yahoo.

Costly indeed, since the new price is much higher than Google had previously ponied up to Mozilla. In 2010, Google contributed 84 percent of Mozilla’s $123 million in revenue.

A previous version of the partnership had expired at the end of November, and the new talks were done against a backdrop of simmering tension between Google and Mozilla over Chrome.

As Liz Gannes wrote earlier this week:

Since the first search royalty deal was signed in 2008, Google’s own Chrome browser has become a significant competitor. Just last month, Chrome overtook Firefox in global usage for the first time, according to StatCounter. Both browsers — software which is used to navigate the Internet — have about 25 percent market share.

Even with the new default deal with Google, Mozilla still also has partnerships with other search providers, including Bing, Yahoo, Yandex, Amazon and eBay.

Of course, everybody declined to comment on my queries to hand over all the financial deets stat.

But Google’s SVP of Search, Alan Eustace, said in a statement: “Mozilla has been a valuable partner to Google over the years and we look forward to continuing this great partnership in the years to come.”

Great, perhaps, but also much more expensive — so presumably Firefox is worth it.

Here’s Mozilla’s full statement:

Our search relationship with Google remains positive for both of us. We are in active negotiations and have nothing further to announce at this time.  We have every confidence that search partnerships will continue to be a strong and growing generator of revenue for the foreseeable future.

Mozilla said it also has partnerships with other search providers, including Bing, Yahoo, Yandex, Amazon and eBay.

Mozilla’s overarching organization is a non-profit, but historically it has made most of its revenue via a royalty deal for searches made through the featured Google toolbar in its Firefox browser. In 2010 Google contributed 84 percent of Mozilla’s $123 million in revenue, as ZDNet writer Ed Bott detailed in a post questioning Firefox’s viability.

Google and Mozilla had in 2008 said their deal was extended to November 2011. That was a significant vote of support from the search giant as it was right around the same time as the first release of its own browser, Chrome.

But Mozilla hadn’t publicly indicated that the deal was extended past this November, Bott pointed out.

Now, three years later, Chrome has just overtaken Firefox for the first time in browser market share, according to the analytics firm StatCounter. The timing is eerily precise.

Last month Chrome had 25.69 percent share compared to Firefox’s 25.23 percent. Microsoft’s Internet Explorer still leads both of them.

I would add that I recently visited Mozilla’s new swanky top-floor San Francisco office with a deck directly overlooking the Bay Bridge (see photo above). The swanky setting didn’t project any particular concern about incoming revenue.