Microsoft Corp's chief executive attempted to laugh off the challenge of Google Inc's planned computer operating system on Tuesday, conceding only that it was interesting.

I will be respectful, Microsoft CEO Steve Ballmer said to laughs from the audience at a conference for the company's technology partners in New Orleans, which was broadcast over the Internet.

Who knows what this thing is? To me, the Chrome OS thing is highly interesting, said Ballmer, choosing his words carefully and drawing more amusement from the largely pro-Microsoft crowd.

It won't happen for a year and a half and they already announced an operating system, he added, referring to Google's Android system for smartphones.

Last week Google said it was planning a computer operating system based on its Chrome browser, aiming directly at the core business for Microsoft, the world's largest software company, whose Windows operating systems are used on more than 90 percent of personal computers.

Google's plan, based on the theory that access to the Internet is now the most important feature of any computing device, is separate from its Android system already available for smartphones and soon for small PCs.

I don't know if they can't make up their mind or what the problem is over there, but the last time I checked, you don't need two client operating systems, said Ballmer. It's good to have one.

Microsoft shares fell 14 cents to $23.09 on Tuesday afternoon on the Nasdaq.

(Reporting by Bill Rigby, editing by Matthew Lewis)

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