A tough battle with rival Microsoft's new desktop search facility may loom, but the world's largest internet search engine remains upbeat about its future, writes Jamie Smyth.

It has been a busy few months for Mr Jonathan Rosenberg, vice-president of product management at Google, the world's biggest internet search engine.

The former Apple and Excite executive, who joined Google in 2002, is responsible for developing and managing Google's product lines. Still best-known for its advertising and Web search services, over the past eight months the US company has launched a host of new services including the email service Gmail and a desktop search tool.

And there are few signs that either Google or its product guru, Mr Rosenberg, are ready to slow down the pace of development. "We want to be involved at all stages of the search process for consumers. It doesn't matter whether this is searching emails, instant messages or the files on a person's desktop PC," he says.

"By default, Google's engine will search all of these media to help find information for people."

The launch of Google's new desktop search engine tool in October enables computer users to sift through and locate a wide range of files on their PCs. The tool can search programmes such as Outlook/Outlook Express, Word, AOL Instant Messenger, Excel, Internet Explorer and PowerPoint.

More to the point, it has left technology observers in no doubt that Google is willing to take on Microsoft on its own patch, the Windows operating system.

Rumours that Microsoft is developing a new desktop search tool are all over the internet, and the 800-pound gorilla of the industry recently launched a beta version of a new search engine to compete against Google. So can Google survive the Redmond glare where others have failed?

"Clearly, Microsoft has recognised the value of search in the product space and is expanding in that area," says Mr Rosenberg, who refuses to be drawn on Google's impending battle with the world's biggest software firm.

Google executives generally do not talk about forthcoming product releases to the media for fear of alerting its main competitors - Microsoft and Yahoo. But Mr Rosenberg does give an insight into the areas where he feels Google will strive to innovate in the "search space" in the future.

"The holy grail for the future is to get a much better and deeper understanding of what the user intends when he or she makes a search enquiry. We can then personalise the query to match a user's requirements.

"For example, if we know a lot of information about the user, perhaps that they have visited certain kinds of sites before, we can offer them more useful results," says Mr Rosenberg, who highlights that harvesting this information is a major challenge.

The third area where significant improvements can be made is in the indexing of content such as newspapers, digital photographs and emails, to make them available to searches, he says.

Earlier this year, Google addressed one of these target areas with the trial launch of its personal email service, Gmail.

Gmail, which is a free email service that is still on trial, offers consumers up to one gigabyte of storage capacity - enough to store a lifetime of email messages. A powerful search tool in the service enables users to search easily through the emails.

In a boost to consumers, Google's entry into a sector dominated by Microsoft prompted a swift response from the software giant, which has increased the storage capacity of its free email service Hotmail.com to 250 megabytes.

Yet despite Google's famous slogan "Don't be Evil", Gmail has proved controversial among privacy advocates, who are concerned its practice of scanning the content of personal emails to tailor advertising to consumers is a step too far. One of the big concerns expressed is that Google does not disclose how long it will keep emails on its servers after the messages have been deleted.

Mr Rosenberg will not reveal how many people are using the trial beta version of the Gmail service but he describes it as "millions" and denies privacy concerns are delaying a full launch. "The privacy issue hasn't delayed it, as far as I am aware," he says. "And I believe we have successfully responded to it by amending our privacy policy. You have to remember people don't have to use this, they chose to use it."

But many privacy campaigners disagree and the Gmail controversy has, perhaps for the first time, dented Google's brand, which is currently one of the world's most recognisable.

Google's rapid success - it was founded in 1998 - is one of the most phenomenal success stories in business history. Unlike most modern business, Google has not used traditional advertising to spread its reach, instead focusing on word of mouth and the internet to grow its business.

So will it change its policy after its recent public flotation, as it seeks to grow in international markets where Google faces tough local competition?

"We think it is much more efficient to target customers online and to maintain a very focused product organisation," he says.

Whether this approach succeeds in difficult markets for Google such as China and Japan remains to be seen. But a bigger challenge for Google will be its ability to satisfy investors that it can maintain its 100 per cent year-on-year earnings growth as Microsoft and Yahoo target the search market more aggressively.

Mr Rosenberg says Google can maintain strong growth by capitalising on the continuing shift of advertising spend to the online world from traditional media.

"I think there will be pressure on existing media to secure advertising going forward. They will be increasingly forced to prove the value of their advertising slots to advertisers," he says. "But I don't believe online media will get all the advertising dollars."

Google's business model relies on selling advertising slots next to its own search results or allowing publishers to earn money by displaying Google advertisements on their own web pages. In both cases, advertisers pay up when anyone clicks on their advertisements, enabling companies to gain competitive advantage by hiring workers to spend all day clicking on rivals' advertisements. This fraud could account for 10 to 20 per cent of all pay-per-click advertising, potentially undermining the medium.

But, for now, advertisers and Google investors - the stock is up almost 100 per cent since its flotation - don't seem too concerned about what Newsweek magazine describes as the Google "Clicking Con Game".

"Advertisers are telling us that if they can get more clicks at the same cost they will go for it," says Mr Rosenberg, upbeat about the future for online advertising and search.