Both Google and Microsoft have been both recently saying that they are not interested in what the other is up to, they don't have enough time to worry about that when they are too busy creating products.

Larry Page has stated that Google is too busy creating products and services to keep a watchful eye on what Microsoft is up to. Then recently Microsoft's Steve Ballmer totally played down Microsoft's rivalry with Google and said that Microsoft is more focused on creating internet content and services that will lure advertisers and revenue, which is way different than what Google is doing.

I have no doubt in my mind that both Steve and Larry are not themselves watching each other, but I do bet they do have teams and focus groups keeping a close watch on what each other is up to, and what works and doesn't work from the products that are released by the two teams.

They are in the same playing field, vying for the same customers, and both striving to be the most successful in internet search.