Microsoft is preparing to challenge Google Base with its own online listing service called Freemont. The service is currently in internal beta testing but Charlene Li at Forrester concludes that it will be better than Google Base.

Google Base is an unstructured online database of user-supplied content. Its stated purpose is to make more information searchable (in line with Google’s primary mission), but it is causing waves in the ecommerce world. Our CEO Scot Wingo has blogged about Google Base several times, raising its profile among sellers who currently utilize eBay as a sales channel. ChannelAdvisor has even announced official support for sending inventory feeds to Google Base from our Merchant platform.

Google Base does offer some great advantages for sellers – it’s free and integrates into Froogle searches. The parlor game is now to speculate on how far Google will take Base into competing as a full online marketplace. I have said that I think it’s more about bringing more information into the realm of Google searches and Charlene and Danny Sullivan at Search Engine Watch seem to agree. That said, the implications for online marketplaces and especially classifieds are enormous. Few things validate an online service’s approach than a direct confrontation by Microsoft. And Microsoft is about to face off against Google Base with its Freemont service.

What’s exciting to me about the service, now in Microsoft internal beta, and what Charlene highlights, is its ability to limit viewing of posted material to a specified list of contacts. Microsoft points to using a contact list in MSN Messenger as an example, but there is a far more interesting aspect for retailers. When used as a marketplace this ability could be used to target promotions to certain client lists. Right now many retailers use mailings to target a portion of their customer base with exclusive offers and private shopping events. Freemont will offer the ability to maintain an exclusive online listing area for select customers.

This service is still in beta so I don’t know how it will ultimately work or if as Charlene Li suggests it will be better than Google Base. But the competition in this market space is great news for both buyers and sellers.

[Update: Scott Wingo has posted a few more links to articles on Freemont and Google Base.]