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SEATTLE, Washington (AP) -- The next version of Microsoft Corp.'s Web browser makes it easier for people to surf the Internet without leaving a trace.

Companies that sell advertisements online, including Microsoft, can electronically gather tidbits about Web surfers' habits and then use that information to help decide what kinds of ads to show.

However, in the newest "beta" test version of Microsoft's forthcoming Internet Explorer 8, which was made available Wednesday, a mode called InPrivateBrowsing lets users surf without having a list of sites they visit get stored on their computers.

The program also covers other footprints, including temporary Internet files and cookies, the small data files that Web sites put on visitors' computers to track their activities.

Both Internet Explorer 7, Microsoft's current browser, and Mozilla's recently released Firefox 3 allow users to block cookies. The top two browsers also let users delete private information such as temporary files and browsing history after the fact. But they can't turn off that collection entirely.

The beta also introduces an additional InPrivateBlocking mode, which can block third-party content from appearing on Web sites. For example, a news site might carry stock quotes from one company and weather information from another. Companies that provide such content may also be collecting and sharing information about what people do online. But users who turn on InPrivateBlocking won't see that content or be exposed to such data collection without their consent.

InPrivateBlocking can also keep some types of ads from appearing, including those served up by Microsoft's own advertising platform, whose success is considered crucial to the software maker's future.

JJ Richards, a general manager in Microsoft's advertising division, responded in a statement that consumers understand that they get free content and services in exchange for advertising but want "transparency, trust and control with respect to the sites they visit."

"If IE8 helps heighten awareness of this value exchange, that's a step in the right direction," he said.

Users surfing with InPrivateBlocking turned on can review a list of which companies are trying to display or collect data. Users also can click a link to read more and decide case by case whether to permit certain ones to go ahead.

"Today as a user, we have no visibility or control over how that information is shared and recorded," said James Pratt, a product manager for IE8. "I wouldn't put Microsoft as being the arbiter of what should and shouldn't be tracked."

InPrivateBlocking isn't purely an ad-blocker by design, but publishers are still worried, said Mike Zaneis, vice president of public policy for the Internet Advertising Bureau, which represents Web publishers.

If InPrivateBlocking were widely adopted by IE8 users, small sites that rely almost exclusively on outside companies to serve ads couldn't survive, he said. The Internet ad economy didn't crash after ad-blocking plug-ins appeared for Firefox, but Zaneis said that may have more to do with Firefox's much smaller market share. (Firefox's challenge to IE has grown, however; the browser is used by more than 10 percent of Web surfers.)

If IE8 blocks programs that track how many times an ad is seen -- a calculation that helps determine payments to advertisers and publishers -- that could also bring down the Web ad marketplace, Zaneis noted.

"We'll wait and see what the marketplace looks like," he said. "I think [Microsoft] realizes, we all realize, that it's a beta version, and it's sure to change before it's finalized."

An earlier IE8 beta showed off many bells and whistles that make Web browsing easier. Since then, Microsoft said it also improved the address bar's ability to figure out users' intended Web destination as they type.

An improved search box also provides more content alongside suggested results. For example, an Amazon.com search for an music album, entered in the browser toolbar, populates a drop-down menu with titles, prices and thumbnails of cover art.

Microsoft would not say when it plans to release a final version of the newest browser but said this second beta is ready for average users to try.

Courtesty - http://www.cnn.com/2008/TECH/08/28/microsoft.broswer.explorer.ap/index.html

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