Building on the Custom Search Engine it introduced last October, Google on Tuesday took the wraps off a new hosted search site designed for businesses, which offers greater flexibility for a small, yearly fee. The service targets small to medium-sized businesses and will surely ruffle the feathers at Microsoft.

The basic premise is pretty simple: Google is able to provide the best search results for the vastness of the Web, so it could do the same for a company's own Web site. The Mountain View, Calif. company has long offered hardware solutions including the pricey Enterprise Search Appliance and more-affordable Google Mini, but the setup cost involved was still too high for many.

Google's new Custom Search Business Edition aims to remedy that issue. Because it's hosted on Google's own infrastructure, setup is a snap. Businesses can provide their branding for the results pages, and no ads will be displayed as with the regular Custom Search Engine. In addition, businesses can also obtain search results in XML form and fully control how they are displayed.

"This offering should be a great help to the millions of businesses that have a web presence but don't offer users any way to search the site. Instead of being left on their own to navigate content, visitors to CSBE-enabled sites will be able to navigate through search results without ever leaving the site," said Nitin Mangtani, Product Manager for Enterprise Search at Google.

Pricing starts at $100 per year for indexing up to 5,000 pages, and $500 for 50,000 pages. Those businesses needing to index 1 million pages will need to fork up $15,000, which makes the hardware search appliance a better fit in that instance.

The move further bulks up Google's enterprise offerings on the Web and ups the ante in its war with Microsoft. The Redmond company launched its Web-based Office Live offerings last year and has continued to increase its offerings for small businesses. Google is doing the same with Google Apps and is pushing its Gmail service for business use as well.