Yahoo! Inc. (NASDAQ: YHOO) won't be the default search toolbar on the Internet Explorer browser included on new Hewlett-Packard (NYSE: HPQ) and Acer computers soon, according to the company. With toolbars being a main way PC users use internet search, this could cost Yahoo! dearly.

In what will surely be a blow to Microsoft's attempt to stem browser attrition by launching IE7, Google has just wednesday afternoon begun a passive campaign to promote Firefox.

Though not directly challenging Microsoft, the recommendation to its user base of Firefox over internet explorer will go a long way with regards to undermining Microsoft.  As Lita notes, Microsoft’s IE browser currently holds 84.7% of the market but is down 3.9% from last year's 88.6% market share. Firefox currently holds 10% market share, up 3.3% from last year's 6.7% share. Of course there is attribution from new users, but the analogous rise of Firefox's market share coinciding with IE's loss of market share highlights well the threat to Microsoft this new Google/Firefox alliance portends.

The additional kicker for Firefox is that the passive ad-campaign which would normally cost in the millions of dollars is being done for free by Google.  The strategic alliance then clearly benefits Firefox, but what of Google?

Google is clearly not just the benevolent behemoth out to help start-ups, as Sarah noted earlier this week the "who-is" behind the "Evil-Empire" is becoming more ambiguous as the future harkens.