IBM and Yahoo issued a new version of their free enterprise search product on Tuesday, just weeks after rival Microsoft announced a competing product.

The latest release of IBM's OmniFind Yahoo Edition contains a number of enhancements, according to IBM. Users can now generate up to five separate indexes of documents, thereby enabling them to search from a particular set instead of the entire repository.

Other tweaks include the ability to define additional custom search fields, such as from HTML tags or document metadata. "If you've created a Word document with customer metadata fields, it will be able to extract it," said Aaron Brown, IBM's director of search and content discovery. IBM also said the software is now easier to install as a Windows service.

OmniFind Yahoo Edition is based on the open source Lucene project. The update includes the latest version of the Lucene core, according to Brown: "It helps us close the loop with the community, because we've contributed a lot of IBM code back into Lucene."

However, the update does not include any scalability improvements, and remains limited to searching 500,000 documents per instance, Brown said.

Brown said the updates were primarily guided by feedback from customers. The software has been downloaded about 25,000 times, according to IBM. Yahoo and IBM released the first version of the search engine about one year ago.

Microsoft's entry into the stand-alone enterprise search market has been seen as potentially disruptive for certain vendors, such as Coveo, but not for search companies offering high-end, specialized products.

Like IBM, Microsoft is adopting a multitier strategy around search. Both companies are giving away an offering in the hopes of attracting customers, who will eventually desire greater capabilities and pay for commercial products.

Microsoft's new products, Search Server 2008 and Search Server Express 2008, which is free, will be generally available in the first half of 2008, according to the company.

Brown said Microsoft's move was not unexpected: "We obviously didn't have any inside information. I can't say I was entirely surprised, given where the market is moving."

He said there is "a lot of traction" in Europe for OmniFind Yahoo Edition right now, adding that a range of organizations are using the product, from a small U.S. public school district to a global electronics company, which he did not name.

Burton Group analyst Guy Creese recently told IDG News Service that he expected Microsoft's partner community to build products on top of the company's base search technology, extending its market potential. IBM has a head start in this area, with companies such as Axioma.

Brown said of IBM's partners, "They've adopted the base platform and are building richer stuff."