Free or Ad-Free?

Microsoft is going to give away the online version of Office 2010 for free.  Douglas Rushkoff thinks this is the wrong approach:

So, the same announcement by two different companies means two very different things. For Google, free software means a new advertising platform. For Microsoft, it means the demise of another source of revenue. Of course, if Microsoft really wanted to undermine Google’s journey into the free, it would keep its customers paying for software but start giving away the ads. The fact that it can’t do that demonstrates that Microsoft is on the wrong side of the equation of free stuff.

I’m not so sure giving away the ads for free is the right approach either, actually.  How would that even work?

So here’s an idea.  Why doesn’t Microsoft come out with a new version of Internet Explorer that does two things:

First, it would come with a built-in feature that blocks all ads – or at least all Google Ads.  (All ads would be better, but if they could just focus it on Google that would be a start.)

And second, it would have a browser built in, as the default homepage, that searched the internet with no ads at all.  Ad-free searching.  (And preferably not Bing, please.  Microsoft should do something that is not flashy, but is very functional.)

Then, integrate this browser with Windows 7 as closely and easily as possible.

I’m not sure that would be a Google-killer at all, but it might give people not just a new search engine, but a new way to search and browse the internet – ad-free.

(And I’m well aware that Firefox has plugins that can do that already, but honestly how many people use those?  Default is key.)

Thoughts?