Use the DefaultSearchManager as the exclusive authority on DSE, ignoring Web Data.

BUG=365762
[email protected], [email protected], [email protected], [email protected]

Committed: https://src.chromium.org/viewvc/chrome?view=rev&revision=269396

Review URL: https://codereview.chromium.org/268643002

git-svn-id: svn://svn.chromium.org/chrome/trunk/src@269725 0039d316-1c4b-4281-b951-d872f2087c98
diff --git a/chrome/browser/search_engines/default_search_manager.cc b/chrome/browser/search_engines/default_search_manager.cc
index 9d344ee4..fefe7b45 100644
--- a/chrome/browser/search_engines/default_search_manager.cc
+++ b/chrome/browser/search_engines/default_search_manager.cc
@@ -128,7 +128,8 @@
 
   if (source)
     *source = FROM_FALLBACK;
-  return fallback_default_search_.get();
+  return TemplateURLService::fallback_search_engines_disabled() ?
+      NULL : fallback_default_search_.get();
 }
 
 DefaultSearchManager::Source
diff --git a/chrome/browser/search_engines/default_search_pref_migration.cc b/chrome/browser/search_engines/default_search_pref_migration.cc
index 835254a..0424194c 100644
--- a/chrome/browser/search_engines/default_search_pref_migration.cc
+++ b/chrome/browser/search_engines/default_search_pref_migration.cc
@@ -13,6 +13,7 @@
 #include "chrome/browser/search_engines/default_search_manager.h"
 #include "chrome/browser/search_engines/template_url.h"
 #include "chrome/browser/search_engines/template_url_service.h"
+#include "chrome/common/pref_names.h"
 
 namespace {
 
@@ -28,6 +29,25 @@
       scoped_ptr<TemplateURLData>() : legacy_dse_from_prefs.Pass();
 }
 
+void ClearDefaultSearchProviderFromLegacyPrefs(PrefService* prefs) {
+  prefs->ClearPref(prefs::kDefaultSearchProviderName);
+  prefs->ClearPref(prefs::kDefaultSearchProviderKeyword);
+  prefs->ClearPref(prefs::kDefaultSearchProviderSearchURL);
+  prefs->ClearPref(prefs::kDefaultSearchProviderSuggestURL);
+  prefs->ClearPref(prefs::kDefaultSearchProviderInstantURL);
+  prefs->ClearPref(prefs::kDefaultSearchProviderImageURL);
+  prefs->ClearPref(prefs::kDefaultSearchProviderNewTabURL);
+  prefs->ClearPref(prefs::kDefaultSearchProviderSearchURLPostParams);
+  prefs->ClearPref(prefs::kDefaultSearchProviderSuggestURLPostParams);
+  prefs->ClearPref(prefs::kDefaultSearchProviderInstantURLPostParams);
+  prefs->ClearPref(prefs::kDefaultSearchProviderImageURLPostParams);
+  prefs->ClearPref(prefs::kDefaultSearchProviderIconURL);
+  prefs->ClearPref(prefs::kDefaultSearchProviderEncodings);
+  prefs->ClearPref(prefs::kDefaultSearchProviderPrepopulateID);
+  prefs->ClearPref(prefs::kDefaultSearchProviderAlternateURLs);
+  prefs->ClearPref(prefs::kDefaultSearchProviderSearchTermsReplacementKey);
+}
+
 void MigrateDefaultSearchPref(PrefService* pref_service) {
   DCHECK(pref_service);
 
@@ -55,8 +75,7 @@
     }
   }
 
-  // TODO(erikwright): Clear the legacy value when the modern value is the
-  // authority.
+  ClearDefaultSearchProviderFromLegacyPrefs(pref_service);
 }
 
 void OnPrefsInitialized(PrefService* pref_service,
diff --git a/chrome/browser/search_engines/default_search_pref_migration_unittest.cc b/chrome/browser/search_engines/default_search_pref_migration_unittest.cc
index 1813670..bc245f9 100644
--- a/chrome/browser/search_engines/default_search_pref_migration_unittest.cc
+++ b/chrome/browser/search_engines/default_search_pref_migration_unittest.cc
@@ -7,12 +7,14 @@
 #include <string>
 
 #include "base/compiler_specific.h"
+#include "base/files/scoped_temp_dir.h"
+#include "base/logging.h"
 #include "base/macros.h"
+#include "base/prefs/pref_service.h"
 #include "base/strings/string16.h"
 #include "base/strings/utf_string_conversions.h"
 #include "chrome/browser/search_engines/template_url.h"
 #include "chrome/browser/search_engines/template_url_service.h"
-#include "chrome/browser/search_engines/template_url_service_test_util.h"
 #include "chrome/test/base/testing_pref_service_syncable.h"
 #include "chrome/test/base/testing_profile.h"
 #include "testing/gtest/include/gtest/gtest.h"
@@ -23,16 +25,21 @@
 
   // testing::Test:
   virtual void SetUp() OVERRIDE;
-  virtual void TearDown() OVERRIDE;
 
   scoped_ptr<TemplateURL> CreateKeyword(const std::string& short_name,
                                         const std::string& keyword,
                                         const std::string& url);
 
-  TemplateURLServiceTestUtil* test_util() { return &test_util_; }
+  TestingProfile* profile() { return profile_.get(); }
+
+  DefaultSearchManager* default_search_manager() {
+    return default_search_manager_.get();
+  }
 
  private:
-  TemplateURLServiceTestUtil test_util_;
+  base::ScopedTempDir temp_dir_;
+  scoped_ptr<TestingProfile> profile_;
+  scoped_ptr<DefaultSearchManager> default_search_manager_;
 
   DISALLOW_COPY_AND_ASSIGN(DefaultSearchPrefMigrationTest);
 };
@@ -41,11 +48,10 @@
 }
 
 void DefaultSearchPrefMigrationTest::SetUp() {
-  test_util_.SetUp();
-}
-
-void DefaultSearchPrefMigrationTest::TearDown() {
-  test_util_.TearDown();
+  ASSERT_TRUE(temp_dir_.CreateUniqueTempDir());
+  profile_.reset(new TestingProfile(temp_dir_.path()));
+  default_search_manager_.reset(new DefaultSearchManager(
+      profile_->GetPrefs(), DefaultSearchManager::ObserverCallback()));
 }
 
 scoped_ptr<TemplateURL> DefaultSearchPrefMigrationTest::CreateKeyword(
@@ -56,7 +62,7 @@
   data.short_name = base::ASCIIToUTF16(short_name);
   data.SetKeyword(base::ASCIIToUTF16(keyword));
   data.SetURL(url);
-  scoped_ptr<TemplateURL> t_url(new TemplateURL(test_util_.profile(), data));
+  scoped_ptr<TemplateURL> t_url(new TemplateURL(profile(), data));
   return t_url.Pass();
 }
 
@@ -64,46 +70,74 @@
   scoped_ptr<TemplateURL> t_url(
       CreateKeyword("name1", "key1", "http://foo1/{searchTerms}"));
   // Store a value in the legacy location.
-  test_util()->model()->SaveDefaultSearchProviderToPrefs(
-      t_url.get(), test_util()->profile()->GetPrefs());
+  TemplateURLService::SaveDefaultSearchProviderToPrefs(t_url.get(),
+                                                       profile()->GetPrefs());
 
   // Run the migration.
-  ConfigureDefaultSearchPrefMigrationToDictionaryValue(
-      test_util()->profile()->GetPrefs());
+  ConfigureDefaultSearchPrefMigrationToDictionaryValue(profile()->GetPrefs());
 
   // Test that it was migrated.
-  DefaultSearchManager manager(test_util()->profile()->GetPrefs(),
-                               DefaultSearchManager::ObserverCallback());
-  TemplateURLData* modern_default = manager.GetDefaultSearchEngine(NULL);
+  DefaultSearchManager::Source source;
+  const TemplateURLData* modern_default =
+      default_search_manager()->GetDefaultSearchEngine(&source);
   ASSERT_TRUE(modern_default);
+  EXPECT_EQ(DefaultSearchManager::FROM_USER, source);
   EXPECT_EQ(t_url->short_name(), modern_default->short_name);
   EXPECT_EQ(t_url->keyword(), modern_default->keyword());
   EXPECT_EQ(t_url->url(), modern_default->url());
 }
 
+TEST_F(DefaultSearchPrefMigrationTest, MigrateOnlyOnce) {
+  scoped_ptr<TemplateURL> t_url(
+      CreateKeyword("name1", "key1", "http://foo1/{searchTerms}"));
+  // Store a value in the legacy location.
+  TemplateURLService::SaveDefaultSearchProviderToPrefs(t_url.get(),
+                                                       profile()->GetPrefs());
+
+  // Run the migration.
+  ConfigureDefaultSearchPrefMigrationToDictionaryValue(profile()->GetPrefs());
+
+  // Test that it was migrated.
+  DefaultSearchManager::Source source;
+  const TemplateURLData* modern_default =
+      default_search_manager()->GetDefaultSearchEngine(&source);
+  ASSERT_TRUE(modern_default);
+  EXPECT_EQ(DefaultSearchManager::FROM_USER, source);
+  EXPECT_EQ(t_url->short_name(), modern_default->short_name);
+  EXPECT_EQ(t_url->keyword(), modern_default->keyword());
+  EXPECT_EQ(t_url->url(), modern_default->url());
+  default_search_manager()->ClearUserSelectedDefaultSearchEngine();
+
+  // Run the migration.
+  ConfigureDefaultSearchPrefMigrationToDictionaryValue(profile()->GetPrefs());
+
+  // Test that it was NOT migrated.
+  modern_default = default_search_manager()->GetDefaultSearchEngine(&source);
+  ASSERT_TRUE(modern_default);
+  EXPECT_EQ(DefaultSearchManager::FROM_FALLBACK, source);
+}
+
 TEST_F(DefaultSearchPrefMigrationTest, ModernValuePresent) {
   scoped_ptr<TemplateURL> t_url(
       CreateKeyword("name1", "key1", "http://foo1/{searchTerms}"));
   scoped_ptr<TemplateURL> t_url2(
       CreateKeyword("name2", "key2", "http://foo2/{searchTerms}"));
   // Store a value in the legacy location.
-  test_util()->model()->SaveDefaultSearchProviderToPrefs(
-      t_url.get(), test_util()->profile()->GetPrefs());
+  TemplateURLService::SaveDefaultSearchProviderToPrefs(t_url.get(),
+                                                       profile()->GetPrefs());
 
   // Store another value in the modern location.
-  DefaultSearchManager(test_util()->profile()->GetPrefs(),
-                       DefaultSearchManager::ObserverCallback())
-      .SetUserSelectedDefaultSearchEngine(t_url2->data());
+  default_search_manager()->SetUserSelectedDefaultSearchEngine(t_url2->data());
 
   // Run the migration.
-  ConfigureDefaultSearchPrefMigrationToDictionaryValue(
-      test_util()->profile()->GetPrefs());
+  ConfigureDefaultSearchPrefMigrationToDictionaryValue(profile()->GetPrefs());
 
   // Test that no migration occurred. The modern value is left intact.
-  DefaultSearchManager manager(test_util()->profile()->GetPrefs(),
-                               DefaultSearchManager::ObserverCallback());
-  TemplateURLData* modern_default = manager.GetDefaultSearchEngine(NULL);
+  DefaultSearchManager::Source source;
+  const TemplateURLData* modern_default =
+      default_search_manager()->GetDefaultSearchEngine(&source);
   ASSERT_TRUE(modern_default);
+  EXPECT_EQ(DefaultSearchManager::FROM_USER, source);
   EXPECT_EQ(t_url2->short_name(), modern_default->short_name);
   EXPECT_EQ(t_url2->keyword(), modern_default->keyword());
   EXPECT_EQ(t_url2->url(), modern_default->url());
@@ -111,70 +145,21 @@
 
 TEST_F(DefaultSearchPrefMigrationTest,
        AutomaticallySelectedValueIsNotMigrated) {
-  test_util()->VerifyLoad();
-  scoped_ptr<TemplateURLData> legacy_default;
-  bool legacy_is_managed = false;
-  // The initialization of the TemplateURLService will have stored the
-  // pre-populated DSE in the legacy location in prefs.
-  ASSERT_TRUE(TemplateURLService::LoadDefaultSearchProviderFromPrefs(
-      test_util()->profile()->GetPrefs(), &legacy_default, &legacy_is_managed));
-  EXPECT_FALSE(legacy_is_managed);
-  EXPECT_TRUE(legacy_default);
-  EXPECT_GT(legacy_default->prepopulate_id, 0);
+  DefaultSearchManager::Source source;
+  TemplateURLData prepopulated_default(
+      *default_search_manager()->GetDefaultSearchEngine(&source));
+  EXPECT_EQ(DefaultSearchManager::FROM_FALLBACK, source);
+
+  TemplateURL prepopulated_turl(profile(), prepopulated_default);
+
+  // Store a value in the legacy location.
+  TemplateURLService::SaveDefaultSearchProviderToPrefs(&prepopulated_turl,
+                                                       profile()->GetPrefs());
 
   // Run the migration.
-  ConfigureDefaultSearchPrefMigrationToDictionaryValue(
-      test_util()->profile()->GetPrefs());
+  ConfigureDefaultSearchPrefMigrationToDictionaryValue(profile()->GetPrefs());
 
   // Test that the legacy value is not migrated, as it is not user-selected.
-  ASSERT_EQ(DefaultSearchManager::FROM_FALLBACK,
-            DefaultSearchManager(test_util()->profile()->GetPrefs(),
-                                 DefaultSearchManager::ObserverCallback())
-                .GetDefaultSearchEngineSource());
-}
-
-TEST_F(DefaultSearchPrefMigrationTest, ManagedValueIsNotMigrated) {
-  // Set a managed preference that establishes a default search provider.
-  const char kName[] = "test1";
-  const char kKeyword[] = "test.com";
-  const char kSearchURL[] = "http://test.com/search?t={searchTerms}";
-  const char kIconURL[] = "http://test.com/icon.jpg";
-  const char kEncodings[] = "UTF-16;UTF-32";
-  const char kAlternateURL[] = "http://test.com/search#t={searchTerms}";
-  const char kSearchTermsReplacementKey[] = "espv";
-
-  // This method only updates the legacy location for managed DSEs. So it will
-  // not cause DefaultSearchManager to report a value.
-  test_util()->SetManagedDefaultSearchPreferences(true,
-                                                  kName,
-                                                  kKeyword,
-                                                  kSearchURL,
-                                                  std::string(),
-                                                  kIconURL,
-                                                  kEncodings,
-                                                  kAlternateURL,
-                                                  kSearchTermsReplacementKey);
-  test_util()->VerifyLoad();
-
-  // Verify that the policy value is correctly installed.
-  scoped_ptr<TemplateURLData> legacy_default;
-  bool legacy_is_managed = false;
-  ASSERT_TRUE(TemplateURLService::LoadDefaultSearchProviderFromPrefs(
-      test_util()->profile()->GetPrefs(), &legacy_default, &legacy_is_managed));
-  EXPECT_TRUE(legacy_is_managed);
-  EXPECT_TRUE(legacy_default);
-
-  // Run the migration.
-  ConfigureDefaultSearchPrefMigrationToDictionaryValue(
-      test_util()->profile()->GetPrefs());
-
-  // TODO(caitkp/erikwright): Look into loading policy values in tests. In
-  // practice, the DefaultSearchEngineSource() would be FROM_POLICY in this
-  // case, but since we are not loading the policy here, it will be
-  // FROM_FALLBACK instead.
-  // Test that the policy-defined value is not migrated.
-  ASSERT_EQ(DefaultSearchManager::FROM_FALLBACK,
-            DefaultSearchManager(test_util()->profile()->GetPrefs(),
-                                 DefaultSearchManager::ObserverCallback())
-                .GetDefaultSearchEngineSource());
+  default_search_manager()->GetDefaultSearchEngine(&source);
+  EXPECT_EQ(DefaultSearchManager::FROM_FALLBACK, source);
 }
diff --git a/chrome/browser/search_engines/template_url_service.cc b/chrome/browser/search_engines/template_url_service.cc
index c6c9a42..1b85a0f 100644
--- a/chrome/browser/search_engines/template_url_service.cc
+++ b/chrome/browser/search_engines/template_url_service.cc
@@ -58,19 +58,12 @@
 
 namespace {
 
-const char kFirstPotentialEngineHistogramName[] =
-    "Search.FirstPotentialEngineCalled";
+bool IdenticalSyncGUIDs(const TemplateURLData* data, const TemplateURL* turl) {
+  if (!data || !turl)
+    return !data && !turl;
 
-// Values for an enumerated histogram used to track whenever
-// FirstPotentialDefaultEngine is called, and from where.
-enum FirstPotentialEngineCaller {
-  FIRST_POTENTIAL_CALLSITE_FIND_NEW_DSP,
-  FIRST_POTENTIAL_CALLSITE_FIND_NEW_DSP_PROCESSING_SYNC_CHANGES,
-  FIRST_POTENTIAL_CALLSITE_ON_LOAD,
-  FIRST_POTENTIAL_CALLSITE_FIND_NEW_DSP_SYNCING,
-  FIRST_POTENTIAL_CALLSITE_FIND_NEW_DSP_NOT_SYNCING,
-  FIRST_POTENTIAL_CALLSITE_MAX,
-};
+  return data->sync_guid == turl->sync_guid();
+}
 
 const char kDeleteSyncedEngineHistogramName[] =
     "Search.DeleteSyncedSearchEngine";
@@ -84,17 +77,6 @@
   DELETE_ENGINE_MAX,
 };
 
-TemplateURL* FirstPotentialDefaultEngine(
-    const TemplateURLService::TemplateURLVector& template_urls) {
-  for (TemplateURLService::TemplateURLVector::const_iterator i(
-       template_urls.begin()); i != template_urls.end(); ++i) {
-    if ((*i)->ShowInDefaultList() &&
-        ((*i)->GetType() == TemplateURL::NORMAL))
-      return *i;
-  }
-  return NULL;
-}
-
 // Returns true iff the change in |change_list| at index |i| should not be sent
 // up to the server based on its GUIDs presence in |sync_data| or when compared
 // to changes after it in |change_list|.
@@ -251,6 +233,9 @@
 
 // TemplateURLService ---------------------------------------------------------
 
+// static
+bool TemplateURLService::g_fallback_search_engines_disabled = false;
+
 TemplateURLService::TemplateURLService(Profile* profile)
     : provider_map_(new SearchHostToURLsMap),
       profile_(profile),
@@ -258,15 +243,15 @@
       load_failed_(false),
       load_handle_(0),
       default_search_provider_(NULL),
-      is_default_search_managed_(false),
       next_id_(kInvalidTemplateURLID + 1),
       time_provider_(&base::Time::Now),
       models_associated_(false),
       processing_syncer_changes_(false),
-      pending_synced_default_search_(false),
       dsp_change_origin_(DSP_CHANGE_OTHER),
       default_search_manager_(
-          GetPrefs(), DefaultSearchManager::ObserverCallback()) {
+          GetPrefs(),
+          base::Bind(&TemplateURLService::OnDefaultSearchChange,
+                     base::Unretained(this))) {
   DCHECK(profile_);
   Init(NULL, 0);
 }
@@ -280,15 +265,15 @@
       load_handle_(0),
       service_(NULL),
       default_search_provider_(NULL),
-      is_default_search_managed_(false),
       next_id_(kInvalidTemplateURLID + 1),
       time_provider_(&base::Time::Now),
       models_associated_(false),
       processing_syncer_changes_(false),
-      pending_synced_default_search_(false),
       dsp_change_origin_(DSP_CHANGE_OTHER),
       default_search_manager_(
-          GetPrefs(), DefaultSearchManager::ObserverCallback()) {
+          GetPrefs(),
+          base::Bind(&TemplateURLService::OnDefaultSearchChange,
+                     base::Unretained(this))) {
   Init(initializers, count);
 }
 
@@ -473,10 +458,11 @@
       search_terms_data, NULL));
 }
 
+// static
 void TemplateURLService::SaveDefaultSearchProviderToPrefs(
     const TemplateURL* t_url,
-    PrefService* prefs) const {
-  if (!prefs || load_failed_)
+    PrefService* prefs) {
+  if (!prefs)
     return;
 
   bool enabled = false;
@@ -608,7 +594,7 @@
       keyword_to_template_map_.find(keyword));
   if (elem != keyword_to_template_map_.end())
     return elem->second;
-  return ((!loaded_ || load_failed_) &&
+  return (!loaded_ &&
       initial_default_search_provider_.get() &&
       (initial_default_search_provider_->keyword() == keyword)) ?
       initial_default_search_provider_.get() : NULL;
@@ -619,7 +605,7 @@
   GUIDToTemplateMap::const_iterator elem(guid_to_template_map_.find(sync_guid));
   if (elem != guid_to_template_map_.end())
     return elem->second;
-  return ((!loaded_ || load_failed_) &&
+  return (!loaded_ &&
       initial_default_search_provider_.get() &&
       (initial_default_search_provider_->sync_guid() == sync_guid)) ?
       initial_default_search_provider_.get() : NULL;
@@ -632,16 +618,18 @@
     if (t_url)
       return t_url;
   }
-  return ((!loaded_ || load_failed_) &&
+  return (!loaded_ &&
       initial_default_search_provider_.get() &&
       (GenerateSearchURL(initial_default_search_provider_.get()).host() ==
           host)) ? initial_default_search_provider_.get() : NULL;
 }
 
-void TemplateURLService::Add(TemplateURL* template_url) {
+bool TemplateURLService::Add(TemplateURL* template_url) {
   WebDataService::KeywordBatchModeScoper keyword_scoper(service_.get());
-  if (AddNoNotify(template_url, true))
-    NotifyObservers();
+  if (!AddNoNotify(template_url, true))
+    return false;
+  NotifyObservers();
+  return true;
 }
 
 void TemplateURLService::AddAndSetProfile(TemplateURL* template_url,
@@ -678,18 +666,8 @@
 
   WebDataService::KeywordBatchModeScoper keyword_scoper(service_.get());
   if (AddNoNotify(template_url, true)) {
-    // Note that we can't call CanMakeDefault() here, since it would return
-    // false when another extension is already controlling the default search
-    // engine, and we want to allow new extensions to take over.
-    if (template_url->extension_info_->wants_to_be_default_engine &&
-        !is_default_search_managed()) {
-      TemplateURL* default_candidate = FindExtensionDefaultSearchEngine();
-      if (default_candidate == template_url) {
-        base::AutoReset<DefaultSearchChangeOrigin> change_origin(
-            &dsp_change_origin_, DSP_CHANGE_OVERRIDE_SETTINGS_EXTENSION);
-        SetDefaultSearchProviderNoNotify(template_url);
-      }
-    }
+    if (template_url->extension_info_->wants_to_be_default_engine)
+      UpdateExtensionDefaultSearchEngine();
     NotifyObservers();
   }
 }
@@ -706,15 +684,13 @@
       extension_id, TemplateURL::NORMAL_CONTROLLED_BY_EXTENSION);
   if (!url)
     return;
-  bool restore_dse = (url == GetDefaultSearchProvider());
-  if (restore_dse) {
-    DCHECK(!is_default_search_managed());
+  // NULL this out so that we can call RemoveNoNotify.
+  // UpdateExtensionDefaultSearchEngine will cause it to be reset.
+  if (default_search_provider_ == url)
     default_search_provider_ = NULL;
-  }
   WebDataService::KeywordBatchModeScoper keyword_scoper(service_.get());
   RemoveNoNotify(url);
-  if (restore_dse)
-    SetDefaultSearchProviderAfterRemovingDefaultExtension();
+  UpdateExtensionDefaultSearchEngine();
   NotifyObservers();
 }
 
@@ -801,25 +777,42 @@
 }
 
 bool TemplateURLService::CanMakeDefault(const TemplateURL* url) {
-  return  !is_default_search_managed() &&
-      !IsExtensionControlledDefaultSearch() &&
-      (url != GetDefaultSearchProvider()) &&
-      url->url_ref().SupportsReplacement() &&
-      (url->GetType() == TemplateURL::NORMAL);
+  return
+      ((default_search_provider_source_ == DefaultSearchManager::FROM_USER) ||
+       (default_search_provider_source_ ==
+           DefaultSearchManager::FROM_FALLBACK)) &&
+       (url != GetDefaultSearchProvider()) &&
+       url->url_ref().SupportsReplacement() &&
+       (url->GetType() == TemplateURL::NORMAL);
 }
 
 void TemplateURLService::SetUserSelectedDefaultSearchProvider(
     TemplateURL* url) {
-  SetDefaultSearchProvider(url);
-  if (url)
-    default_search_manager_.SetUserSelectedDefaultSearchEngine(url->data());
-  else
-    default_search_manager_.ClearUserSelectedDefaultSearchEngine();
+  // Omnibox keywords cannot be made default. Extension-controlled search
+  // engines can be made default only by the extension itself because they
+  // aren't persisted.
+  DCHECK(!url || (url->GetType() == TemplateURL::NORMAL));
+  if (load_failed_) {
+    // Skip the DefaultSearchManager, which will persist to user preferences.
+    if ((default_search_provider_source_ == DefaultSearchManager::FROM_USER) ||
+        (default_search_provider_source_ ==
+         DefaultSearchManager::FROM_FALLBACK)) {
+      ApplyDefaultSearchChange(url ? &url->data() : NULL,
+                               DefaultSearchManager::FROM_USER);
+    }
+  } else {
+    // We rely on the DefaultSearchManager to call OnDefaultSearchChange if, in
+    // fact, the effective DSE changes.
+    if (url)
+      default_search_manager_.SetUserSelectedDefaultSearchEngine(url->data());
+    else
+      default_search_manager_.ClearUserSelectedDefaultSearchEngine();
+  }
 }
 
 TemplateURL* TemplateURLService::GetDefaultSearchProvider() {
-  return (loaded_ && !load_failed_) ?
-      default_search_provider_ : initial_default_search_provider_.get();
+  return loaded_ ?
+    default_search_provider_ : initial_default_search_provider_.get();
 }
 
 bool TemplateURLService::IsSearchResultsPageFromDefaultSearchProvider(
@@ -829,59 +822,29 @@
 }
 
 bool TemplateURLService::IsExtensionControlledDefaultSearch() {
-  const TemplateURL* default_provider = GetDefaultSearchProvider();
-  return default_provider && (default_provider->GetType() ==
-      TemplateURL::NORMAL_CONTROLLED_BY_EXTENSION);
-}
-
-TemplateURL* TemplateURLService::FindNewDefaultSearchProvider() {
-  // See if the prepopulated default still exists.
-  scoped_ptr<TemplateURLData> prepopulated_default =
-      TemplateURLPrepopulateData::GetPrepopulatedDefaultSearch(GetPrefs());
-
-  for (TemplateURLVector::iterator i = template_urls_.begin();
-       i != template_urls_.end(); ++i) {
-    if ((*i)->prepopulate_id() == prepopulated_default->prepopulate_id)
-      return *i;
-  }
-  // If not, use the first non-extension keyword of the templates that supports
-  // search term replacement.
-  if (processing_syncer_changes_) {
-    UMA_HISTOGRAM_ENUMERATION(
-        kFirstPotentialEngineHistogramName,
-        FIRST_POTENTIAL_CALLSITE_FIND_NEW_DSP_PROCESSING_SYNC_CHANGES,
-        FIRST_POTENTIAL_CALLSITE_MAX);
-  } else {
-    if (sync_processor_.get()) {
-      // We're not currently in a sync cycle, but we're syncing.
-      UMA_HISTOGRAM_ENUMERATION(kFirstPotentialEngineHistogramName,
-                                FIRST_POTENTIAL_CALLSITE_FIND_NEW_DSP_SYNCING,
-                                FIRST_POTENTIAL_CALLSITE_MAX);
-    } else {
-      // We're not syncing at all.
-      UMA_HISTOGRAM_ENUMERATION(
-          kFirstPotentialEngineHistogramName,
-          FIRST_POTENTIAL_CALLSITE_FIND_NEW_DSP_NOT_SYNCING,
-          FIRST_POTENTIAL_CALLSITE_MAX);
-    }
-  }
-  return FirstPotentialDefaultEngine(template_urls_);
+  return default_search_provider_source_ ==
+      DefaultSearchManager::FROM_EXTENSION;
 }
 
 void TemplateURLService::RepairPrepopulatedSearchEngines() {
   // Can't clean DB if it hasn't been loaded.
   DCHECK(loaded());
 
+  if ((default_search_provider_source_ == DefaultSearchManager::FROM_USER) ||
+      (default_search_provider_source_ ==
+          DefaultSearchManager::FROM_FALLBACK)) {
+    // Clear |default_search_provider_| in case we want to remove the engine it
+    // points to. This will get reset at the end of the function anyway.
+    default_search_provider_ = NULL;
+  }
+
   size_t default_search_provider_index = 0;
   ScopedVector<TemplateURLData> prepopulated_urls =
       TemplateURLPrepopulateData::GetPrepopulatedEngines(
           GetPrefs(), &default_search_provider_index);
   DCHECK(!prepopulated_urls.empty());
-  int default_search_engine_id =
-      prepopulated_urls[default_search_provider_index]->prepopulate_id;
-  TemplateURL* current_dse = default_search_provider_;
   ActionsFromPrepopulateData actions(CreateActionsFromCurrentPrepopulateData(
-      &prepopulated_urls, template_urls_, current_dse));
+      &prepopulated_urls, template_urls_, default_search_provider_));
 
   WebDataService::KeywordBatchModeScoper keyword_scoper(service_.get());
 
@@ -906,16 +869,20 @@
     AddNoNotify(new TemplateURL(profile_, *i), true);
   }
 
-  // Change the DSE.
-  TemplateURL* new_dse = FindURLByPrepopulateID(template_urls_,
-                                                default_search_engine_id);
-  DCHECK(new_dse);
-  if (CanMakeDefault(new_dse)) {
-    base::AutoReset<DefaultSearchChangeOrigin> change_origin(
-        &dsp_change_origin_, DSP_CHANGE_PROFILE_RESET);
-    SetDefaultSearchProviderNoNotify(new_dse);
+  base::AutoReset<DefaultSearchChangeOrigin> change_origin(
+      &dsp_change_origin_, DSP_CHANGE_PROFILE_RESET);
+
+  default_search_manager_.ClearUserSelectedDefaultSearchEngine();
+
+  if (!default_search_provider_) {
+    DefaultSearchManager::Source source;
+    const TemplateURLData* new_dse =
+        default_search_manager_.GetDefaultSearchEngine(&source);
+    // ApplyDefaultSearchChange will notify observers once it is done.
+    ApplyDefaultSearchChange(new_dse, source);
+  } else {
+    NotifyObservers();
   }
-  NotifyObservers();
 }
 
 void TemplateURLService::AddObserver(TemplateURLServiceObserver* observer) {
@@ -933,12 +900,10 @@
   if (!service_)
     service_ = WebDataService::FromBrowserContext(profile_);
 
-  if (service_) {
+  if (service_)
     load_handle_ = service_->GetKeywords(this);
-  } else {
+  else
     ChangeToLoadedState();
-    on_loaded_callbacks_.Notify();
-  }
 }
 
 scoped_ptr<TemplateURLService::Subscription>
@@ -962,27 +927,29 @@
     load_failed_ = true;
     service_ = NULL;
     ChangeToLoadedState();
-    on_loaded_callbacks_.Notify();
     return;
   }
 
-  // initial_default_search_provider_ is only needed before we've finished
-  // loading. Now that we've loaded we can nuke it.
-  initial_default_search_provider_.reset();
-
   TemplateURLVector template_urls;
-  TemplateURL* default_search_provider = NULL;
   int new_resource_keyword_version = 0;
-  GetSearchProvidersUsingKeywordResult(*result, service_.get(), profile_,
-      &template_urls, &default_search_provider, &new_resource_keyword_version,
+  GetSearchProvidersUsingKeywordResult(
+      *result,
+      service_.get(),
+      profile_,
+      &template_urls,
+      (default_search_provider_source_ == DefaultSearchManager::FROM_USER) ?
+          initial_default_search_provider_.get() : NULL,
+      &new_resource_keyword_version,
       &pre_sync_deletes_);
 
   WebDataService::KeywordBatchModeScoper keyword_scoper(service_.get());
 
-  AddTemplateURLsAndSetupDefaultEngine(&template_urls, default_search_provider);
+  PatchMissingSyncGUIDs(&template_urls);
+  SetTemplateURLs(&template_urls);
 
   // This initializes provider_map_ which should be done before
   // calling UpdateKeywordSearchTermsForURL.
+  // This also calls NotifyObservers.
   ChangeToLoadedState();
 
   // Index any visits that occurred before we finished loading.
@@ -992,11 +959,6 @@
 
   if (new_resource_keyword_version)
     service_->SetBuiltinKeywordVersion(new_resource_keyword_version);
-
-  EnsureDefaultSearchProviderExists();
-
-  NotifyObservers();
-  on_loaded_callbacks_.Notify();
 }
 
 base::string16 TemplateURLService::GetKeywordShortName(
@@ -1024,12 +986,6 @@
       visits_to_add_.push_back(*visit_details.ptr());
     else
       UpdateKeywordSearchTermsForURL(*visit_details.ptr());
-  } else if (type == chrome::NOTIFICATION_DEFAULT_SEARCH_POLICY_CHANGED) {
-    // Policy has been updated, so the default search prefs may be different.
-    // Reload the default search provider from them.
-    // TODO(pkasting): Rather than communicating via prefs, we should eventually
-    // observe policy changes directly.
-    UpdateDefaultSearch();
   } else {
     DCHECK_EQ(chrome::NOTIFICATION_GOOGLE_URL_UPDATED, type);
     if (loaded_) {
@@ -1050,27 +1006,6 @@
   service_ = NULL;
 }
 
-void TemplateURLService::OnSyncedDefaultSearchProviderGUIDChanged() {
-  // Listen for changes to the default search from Sync.
-  PrefService* prefs = GetPrefs();
-  TemplateURL* new_default_search = GetTemplateURLForGUID(
-      prefs->GetString(prefs::kSyncedDefaultSearchProviderGUID));
-  if (new_default_search && !is_default_search_managed_) {
-    if (new_default_search != GetDefaultSearchProvider()) {
-      base::AutoReset<DefaultSearchChangeOrigin> change_origin(
-          &dsp_change_origin_, DSP_CHANGE_SYNC_PREF);
-      SetUserSelectedDefaultSearchProvider(new_default_search);
-      pending_synced_default_search_ = false;
-    }
-  } else {
-    // If it's not there, or if default search is currently managed, set a
-    // flag to indicate that we waiting on the search engine entry to come
-    // in through Sync.
-    pending_synced_default_search_ = true;
-  }
-  UpdateDefaultSearch();
-}
-
 syncer::SyncDataList TemplateURLService::GetAllSyncData(
     syncer::ModelType type) const {
   DCHECK_EQ(syncer::SEARCH_ENGINES, type);
@@ -1186,13 +1121,14 @@
         ResolveSyncKeywordConflict(turl.get(), existing_keyword_turl,
                                    &new_changes);
       }
+      base::AutoReset<DefaultSearchChangeOrigin> change_origin(
+          &dsp_change_origin_, DSP_CHANGE_SYNC_ADD);
       // Force the local ID to kInvalidTemplateURLID so we can add it.
       TemplateURLData data(turl->data());
       data.id = kInvalidTemplateURLID;
-      Add(new TemplateURL(profile_, data));
-
-      // Possibly set the newly added |turl| as the default search provider.
-      SetDefaultSearchProviderIfNewlySynced(guid);
+      TemplateURL* added = new TemplateURL(profile_, data);
+      if (Add(added))
+        MaybeUpdateDSEAfterSync(added);
     } else if (iter->change_type() == syncer::SyncChange::ACTION_UPDATE) {
       if (!existing_turl) {
         error = sync_error_factory_->CreateAndUploadError(
@@ -1207,8 +1143,10 @@
                                    &new_changes);
       }
       UIThreadSearchTermsData search_terms_data(existing_turl->profile());
-      if (UpdateNoNotify(existing_turl, *turl, search_terms_data))
+      if (UpdateNoNotify(existing_turl, *turl, search_terms_data)) {
         NotifyObservers();
+        MaybeUpdateDSEAfterSync(existing_turl);
+      }
     } else {
       // We've unexpectedly received an ACTION_INVALID.
       error = sync_error_factory_->CreateAndUploadError(
@@ -1250,18 +1188,6 @@
   sync_processor_ = sync_processor.Pass();
   sync_error_factory_ = sync_error_factory.Pass();
 
-  // We just started syncing, so set our wait-for-default flag if we are
-  // expecting a default from Sync.
-  if (GetPrefs()) {
-    std::string default_guid = GetPrefs()->GetString(
-        prefs::kSyncedDefaultSearchProviderGUID);
-    const TemplateURL* current_default = GetDefaultSearchProvider();
-
-    if (!default_guid.empty() &&
-        (!current_default || current_default->sync_guid() != default_guid))
-      pending_synced_default_search_ = true;
-  }
-
   // We do a lot of calls to Add/Remove/ResetTemplateURL here, so ensure we
   // don't step on our own toes.
   base::AutoReset<bool> processing_changes(&processing_syncer_changes_, true);
@@ -1340,15 +1266,6 @@
     }
   }
 
-  // If there is a pending synced default search provider that was processed
-  // above, set it now.
-  TemplateURL* pending_default = GetPendingSyncedDefaultSearchProvider();
-  if (pending_default) {
-    base::AutoReset<DefaultSearchChangeOrigin> change_origin(
-        &dsp_change_origin_, DSP_CHANGE_SYNC_ADD);
-    SetUserSelectedDefaultSearchProvider(pending_default);
-  }
-
   // The remaining SyncData in local_data_map should be everything that needs to
   // be pushed as ADDs to sync.
   for (SyncDataMap::const_iterator iter = local_data_map.begin();
@@ -1600,9 +1517,11 @@
             &TemplateURLService::OnSyncedDefaultSearchProviderGUIDChanged,
             base::Unretained(this)));
   }
-  notification_registrar_.Add(
-      this, chrome::NOTIFICATION_DEFAULT_SEARCH_POLICY_CHANGED,
-      content::NotificationService::AllSources());
+
+  DefaultSearchManager::Source source = DefaultSearchManager::FROM_USER;
+  TemplateURLData* dse =
+      default_search_manager_.GetDefaultSearchEngine(&source);
+  ApplyDefaultSearchChange(dse, source);
 
   if (num_initializers > 0) {
     // This path is only hit by test code and is used to simulate a loaded
@@ -1627,17 +1546,15 @@
 
       // Set the first provided identifier to be the default.
       if (i == 0)
-        SetDefaultSearchProviderNoNotify(template_url);
+        default_search_manager_.SetUserSelectedDefaultSearchEngine(data);
     }
   }
 
-  // Initialize default search.
-  UpdateDefaultSearch();
-
   // Request a server check for the correct Google URL if Google is the
   // default search engine and not in headless mode.
-  if (profile_ && initial_default_search_provider_ &&
-      initial_default_search_provider_->HasGoogleBaseURLs()) {
+  TemplateURL* default_search_provider = GetDefaultSearchProvider();
+  if (profile_ && default_search_provider &&
+      default_search_provider->HasGoogleBaseURLs()) {
     scoped_ptr<base::Environment> env(base::Environment::Create());
     if (!env->HasVar(env_vars::kHeadless))
       GoogleURLTracker::RequestServerCheck(profile_, false);
@@ -1750,16 +1667,13 @@
   UIThreadSearchTermsData search_terms_data(profile_);
   provider_map_->Init(template_urls_, search_terms_data);
   loaded_ = true;
-}
 
-void TemplateURLService::ClearDefaultProviderFromPrefs() {
-  // We overwrite user preferences. If the default search engine is managed,
-  // there is no effect.
-  SaveDefaultSearchProviderToPrefs(NULL, GetPrefs());
-  // Default value for kDefaultSearchProviderEnabled is true.
-  PrefService* prefs = GetPrefs();
-  if (prefs)
-    prefs->SetBoolean(prefs::kDefaultSearchProviderEnabled, true);
+  // This will cause a call to NotifyObservers().
+  ApplyDefaultSearchChange(initial_default_search_provider_ ?
+                               &initial_default_search_provider_->data() : NULL,
+                           default_search_provider_source_);
+  initial_default_search_provider_.reset();
+  on_loaded_callbacks_.Notify();
 }
 
 bool TemplateURLService::CanReplaceKeywordForHost(
@@ -1856,13 +1770,13 @@
     service_->UpdateKeyword(existing_turl->data());
 
   // Inform sync of the update.
-  ProcessTemplateURLChange(FROM_HERE,
-                           existing_turl,
-                           syncer::SyncChange::ACTION_UPDATE);
+  ProcessTemplateURLChange(
+      FROM_HERE, existing_turl, syncer::SyncChange::ACTION_UPDATE);
 
-  if (default_search_provider_ == existing_turl) {
-    bool success = SetDefaultSearchProviderNoNotify(existing_turl);
-    DCHECK(success);
+  if (default_search_provider_ == existing_turl &&
+      default_search_provider_source_ == DefaultSearchManager::FROM_USER) {
+    default_search_manager_.SetUserSelectedDefaultSearchEngine(
+        default_search_provider_->data());
   }
   return true;
 }
@@ -1888,6 +1802,15 @@
   }
 }
 
+void TemplateURLService::MaybeUpdateDSEAfterSync(TemplateURL* synced_turl) {
+  if (GetPrefs() &&
+      (synced_turl->sync_guid() ==
+          GetPrefs()->GetString(prefs::kSyncedDefaultSearchProviderGUID))) {
+    default_search_manager_.SetUserSelectedDefaultSearchEngine(
+        synced_turl->data());
+  }
+}
+
 PrefService* TemplateURLService::GetPrefs() {
   return profile_ ? profile_->GetPrefs() : NULL;
 }
@@ -1985,204 +1908,134 @@
     NotifyObservers();
 }
 
-void TemplateURLService::UpdateDefaultSearch() {
-  if (!loaded_) {
-    // Set |initial_default_search_provider_| from the preferences.  We use this
-    // value for default search provider until the database has been loaded.
-    scoped_ptr<TemplateURLData> data;
-    if (!LoadDefaultSearchProviderFromPrefs(
-            GetPrefs(), &data, &is_default_search_managed_)) {
-      // Prefs does not specify, so rely on the prepopulated engines.  This
-      // should happen only the first time Chrome is started.
-      data =
-          TemplateURLPrepopulateData::GetPrepopulatedDefaultSearch(GetPrefs());
-      is_default_search_managed_ = false;
-    }
+void TemplateURLService::OnDefaultSearchChange(
+    const TemplateURLData* data,
+    DefaultSearchManager::Source source) {
+  if (GetPrefs() && (source == DefaultSearchManager::FROM_USER) &&
+      ((source != default_search_provider_source_) ||
+       !IdenticalSyncGUIDs(data, GetDefaultSearchProvider()))) {
+    GetPrefs()->SetString(prefs::kSyncedDefaultSearchProviderGUID,
+                          data->sync_guid);
+  }
+  ApplyDefaultSearchChange(data, source);
+}
 
+void TemplateURLService::ApplyDefaultSearchChange(
+    const TemplateURLData* data,
+    DefaultSearchManager::Source source) {
+  if (!loaded_) {
+    // Set |initial_default_search_provider_| from the preferences. This is
+    // mainly so we can hold ownership until we get to the point where the list
+    // of keywords from Web Data is the owner of everything including the
+    // default.
     initial_default_search_provider_.reset(
         data ? new TemplateURL(profile_, *data) : NULL);
+    default_search_provider_source_ = source;
+    return;
+  }
 
+  // Prevent recursion if we update the value stored in default_search_manager_.
+  // Note that we exclude the case of data == NULL because that could cause a
+  // false positive for recursion when the initial_default_search_provider_ is
+  // NULL due to policy. We'll never actually get recursion with data == NULL.
+  if (source == default_search_provider_source_ && data != NULL &&
+      TemplateURL::MatchesData(default_search_provider_, data))
     return;
-  }
-  // Load the default search specified in prefs.
-  scoped_ptr<TemplateURLData> new_default_from_prefs;
-  bool new_is_default_managed = false;
-  // Load the default from prefs.  It's possible that it won't succeed
-  // because we are in the middle of doing SaveDefaultSearchProviderToPrefs()
-  // and all the preference items have not been saved.  In that case, we
-  // don't have yet a default.  It would be much better if we could save
-  // preferences in batches and trigger notifications at the end.
-  LoadDefaultSearchProviderFromPrefs(
-      GetPrefs(), &new_default_from_prefs, &new_is_default_managed);
-  if (!is_default_search_managed_ && !new_is_default_managed) {
-    // We're not interested in cases where the default was and remains
-    // unmanaged.  In that case, preferences have no impact on the default.
-    return;
-  }
+
+  UMA_HISTOGRAM_ENUMERATION("Search.DefaultSearchChangeOrigin",
+                            dsp_change_origin_, DSP_CHANGE_MAX);
+
   WebDataService::KeywordBatchModeScoper keyword_scoper(service_.get());
-  if (is_default_search_managed_ && new_is_default_managed) {
-    // The default was managed and remains managed.  Update the default only
-    // if it has changed; we don't want to respond to changes triggered by
-    // SaveDefaultSearchProviderToPrefs.
-    if (TemplateURL::MatchesData(default_search_provider_,
-                                 new_default_from_prefs.get()))
-      return;
-    if (!new_default_from_prefs) {
-      // |default_search_provider_| can't be NULL or MatchesData() would have
-      // returned true.  Remove this now invalid value.
-      TemplateURL* old_default = default_search_provider_;
-      bool success = SetDefaultSearchProviderNoNotify(NULL);
-      DCHECK(success);
-      RemoveNoNotify(old_default);
-    } else if (default_search_provider_) {
-      new_default_from_prefs->created_by_policy = true;
-      TemplateURL new_values(profile_, *new_default_from_prefs);
+  if (default_search_provider_source_ == DefaultSearchManager::FROM_POLICY ||
+      source == DefaultSearchManager::FROM_POLICY) {
+    // We do this both to remove any no-longer-applicable policy-defined DSE as
+    // well as to add the new one, if appropriate.
+    UpdateProvidersCreatedByPolicy(
+        &template_urls_,
+        source == DefaultSearchManager::FROM_POLICY ? data : NULL);
+  }
+
+  if (!data) {
+    default_search_provider_ = NULL;
+    default_search_provider_source_ = source;
+    NotifyObservers();
+    return;
+  }
+
+  if (source == DefaultSearchManager::FROM_EXTENSION) {
+    default_search_provider_ = FindMatchingExtensionTemplateURL(
+        *data, TemplateURL::NORMAL_CONTROLLED_BY_EXTENSION);
+  }
+
+  if (source == DefaultSearchManager::FROM_FALLBACK) {
+    default_search_provider_ =
+        FindPrepopulatedTemplateURL(data->prepopulate_id);
+    if (default_search_provider_) {
+      TemplateURLData update_data(*data);
+      update_data.sync_guid = default_search_provider_->sync_guid();
+      if (!default_search_provider_->safe_for_autoreplace()) {
+        update_data.safe_for_autoreplace = false;
+        update_data.SetKeyword(default_search_provider_->keyword());
+        update_data.short_name = default_search_provider_->short_name();
+      }
       UIThreadSearchTermsData search_terms_data(
           default_search_provider_->profile());
-      UpdateNoNotify(default_search_provider_, new_values, search_terms_data);
+      UpdateNoNotify(default_search_provider_,
+                     TemplateURL(profile_, update_data),
+                     search_terms_data);
     } else {
-      TemplateURL* new_template = NULL;
-      if (new_default_from_prefs) {
-        new_default_from_prefs->created_by_policy = true;
-        new_template = new TemplateURL(profile_, *new_default_from_prefs);
-        if (!AddNoNotify(new_template, true))
-          return;
-      }
-      bool success = SetDefaultSearchProviderNoNotify(new_template);
-      DCHECK(success);
+      // Normally the prepopulated fallback should be present in
+      // |template_urls_|, but in a few cases it might not be:
+      // (1) Tests that initialize the TemplateURLService in peculiar ways.
+      // (2) If the user deleted the pre-populated default and we subsequently
+      // lost their user-selected value.
+      TemplateURL* new_dse = new TemplateURL(profile_, *data);
+      if (AddNoNotify(new_dse, true))
+        default_search_provider_ = new_dse;
     }
-  } else if (!is_default_search_managed_ && new_is_default_managed) {
-    // The default used to be unmanaged and is now managed.  Add the new
-    // managed default to the list of URLs and set it as default.
-    is_default_search_managed_ = new_is_default_managed;
-    TemplateURL* new_template = NULL;
-    if (new_default_from_prefs) {
-      new_default_from_prefs->created_by_policy = true;
-      new_template = new TemplateURL(profile_, *new_default_from_prefs);
-      if (!AddNoNotify(new_template, true))
-        return;
+  }
+  if (source == DefaultSearchManager::FROM_USER) {
+    default_search_provider_ = GetTemplateURLForGUID(data->sync_guid);
+    if (!default_search_provider_ && data->prepopulate_id) {
+      default_search_provider_ =
+          FindPrepopulatedTemplateURL(data->prepopulate_id);
     }
-    bool success = SetDefaultSearchProviderNoNotify(new_template);
-    DCHECK(success);
-  } else {
-    // The default was managed and is no longer.
-    DCHECK(is_default_search_managed_ && !new_is_default_managed);
-    is_default_search_managed_ = new_is_default_managed;
-    // If we had a default, delete the previous default if created by policy
-    // and set a likely default.
-    if ((default_search_provider_ != NULL) &&
-        default_search_provider_->created_by_policy()) {
-      TemplateURL* old_default = default_search_provider_;
-      default_search_provider_ = NULL;
-      RemoveNoNotify(old_default);
-    }
-
-    // The likely default should be from Sync if we were waiting on Sync.
-    // Otherwise, it should be FindNewDefaultSearchProvider.
-    TemplateURL* synced_default = GetPendingSyncedDefaultSearchProvider();
-    if (synced_default) {
-      pending_synced_default_search_ = false;
-
-      base::AutoReset<DefaultSearchChangeOrigin> change_origin(
-          &dsp_change_origin_, DSP_CHANGE_SYNC_NOT_MANAGED);
-      SetDefaultSearchProviderNoNotify(synced_default);
+    TemplateURLData new_data(*data);
+    new_data.show_in_default_list = true;
+    if (default_search_provider_) {
+      UIThreadSearchTermsData search_terms_data(
+          default_search_provider_->profile());
+      UpdateNoNotify(default_search_provider_,
+                     TemplateURL(profile_, new_data),
+                     search_terms_data);
     } else {
-      SetDefaultSearchProviderNoNotify(FindNewDefaultSearchProvider());
+      new_data.id = kInvalidTemplateURLID;
+      TemplateURL* new_dse = new TemplateURL(profile_, new_data);
+      if (AddNoNotify(new_dse, true))
+        default_search_provider_ = new_dse;
     }
-  }
-  NotifyObservers();
-}
-
-void TemplateURLService::SetDefaultSearchProvider(
-    TemplateURL* url) {
-  DCHECK(!is_default_search_managed_);
-  // Omnibox keywords cannot be made default. Extension-controlled search
-  // engines can be made default only by the extension itself because they
-  // aren't persisted.
-  DCHECK(!url || (url->GetType() == TemplateURL::NORMAL));
-
-  // Always persist the setting in the database, that way if the backup
-  // signature has changed out from under us it gets reset correctly.
-  if (SetDefaultSearchProviderNoNotify(url))
-    NotifyObservers();
-}
-
-bool TemplateURLService::SetDefaultSearchProviderNoNotify(TemplateURL* url) {
-  if (url) {
-    if (std::find(template_urls_.begin(), template_urls_.end(), url) ==
-        template_urls_.end())
-      return false;
-    // Omnibox keywords cannot be made default.
-    DCHECK_NE(TemplateURL::OMNIBOX_API_EXTENSION, url->GetType());
-  }
-
-  // Only bother reassigning |url| if it has changed. Notice that we don't just
-  // early exit if they are equal, because |url| may have had its fields
-  // changed, and needs to be persisted below (for example, when this is called
-  // from UpdateNoNotify).
-  if (default_search_provider_ != url) {
-    // Engines set by policy override extension-controlled engines, which
-    // override other engines.
-    DCHECK(!is_default_search_managed() || !url ||
-           (url->GetType() == TemplateURL::NORMAL));
-    if (is_default_search_managed() || !default_search_provider_ ||
-        (default_search_provider_->GetType() == TemplateURL::NORMAL) ||
-        (url &&
-         (url->GetType() == TemplateURL::NORMAL_CONTROLLED_BY_EXTENSION))){
-      UMA_HISTOGRAM_ENUMERATION("Search.DefaultSearchChangeOrigin",
-                                dsp_change_origin_, DSP_CHANGE_MAX);
-      default_search_provider_ = url;
+    if (default_search_provider_ && GetPrefs()) {
+      GetPrefs()->SetString(
+          prefs::kSyncedDefaultSearchProviderGUID,
+          default_search_provider_->sync_guid());
     }
+
   }
 
-  if (url) {
-    // Don't mark the url as edited, otherwise we won't be able to rev the
-    // template urls we ship with.
-    url->data_.show_in_default_list = true;
-    if (service_ && (url->GetType() == TemplateURL::NORMAL))
-      service_->UpdateKeyword(url->data());
+  default_search_provider_source_ = source;
 
-    if (url->HasGoogleBaseURLs()) {
+  if (default_search_provider_ &&
+      default_search_provider_->HasGoogleBaseURLs()) {
+    if (profile_)
       GoogleURLTracker::RequestServerCheck(profile_, false);
 #if defined(ENABLE_RLZ)
-      RLZTracker::RecordProductEvent(rlz_lib::CHROME,
-                                     RLZTracker::CHROME_OMNIBOX,
-                                     rlz_lib::SET_TO_GOOGLE);
+    RLZTracker::RecordProductEvent(rlz_lib::CHROME,
+                                   RLZTracker::CHROME_OMNIBOX,
+                                   rlz_lib::SET_TO_GOOGLE);
 #endif
-    }
   }
 
-  // Extension-controlled search engines shouldn't be persisted anywhere.
-  if (url && (url->GetType() == TemplateURL::NORMAL_CONTROLLED_BY_EXTENSION))
-    return true;
-
-  if (!is_default_search_managed_) {
-    SaveDefaultSearchProviderToPrefs(url, GetPrefs());
-
-    // If we are syncing, we want to set the synced pref that will notify other
-    // instances to change their default to this new search provider.
-    // Note: we don't update the pref if we're currently in the middle of
-    // handling a sync operation. Sync operations from other clients are not
-    // guaranteed to arrive together, and any client that deletes the default
-    // needs to set a new default as well. If we update the default here, we're
-    // likely to race with the update from the other client, resulting in
-    // a possibly random default search provider.
-    if (sync_processor_.get() && url && !url->sync_guid().empty() &&
-        GetPrefs() && !processing_syncer_changes_) {
-      GetPrefs()->SetString(prefs::kSyncedDefaultSearchProviderGUID,
-                            url->sync_guid());
-    }
-  }
-
-  if (service_)
-    service_->SetDefaultSearchProviderID(url ? url->id() : 0);
-
-  // Inform sync the change to the show_in_default_list flag.
-  if (url)
-    ProcessTemplateURLChange(FROM_HERE,
-                             url,
-                             syncer::SyncChange::ACTION_UPDATE);
-  return true;
+  NotifyObservers();
 }
 
 bool TemplateURLService::AddNoNotify(TemplateURL* template_url,
@@ -2297,9 +2150,8 @@
   }
   data.safe_for_autoreplace = false;
   data.last_modified = time_provider_();
-  TemplateURL new_url(url->profile(), data);
   UIThreadSearchTermsData search_terms_data(url->profile());
-  return UpdateNoNotify(url, new_url, search_terms_data);
+  return UpdateNoNotify(url, TemplateURL(profile_, data), search_terms_data);
 }
 
 void TemplateURLService::NotifyObservers() {
@@ -2311,41 +2163,35 @@
 }
 
 // |template_urls| are the TemplateURLs loaded from the database.
-// |default_search_provider| points to one of them, if it was set in the db.
-// |default_from_prefs| is the default search provider from the preferences.
-// Check |is_default_search_managed_| to determine if it was set by policy.
+// |default_from_prefs| is the default search provider from the preferences, or
+// NULL if the DSE is not policy-defined.
 //
 // This function removes from the vector and the database all the TemplateURLs
-// that were set by policy, unless it is the current default search provider
-// and matches what is set by a managed preference.
-void TemplateURLService::RemoveProvidersCreatedByPolicy(
+// that were set by policy, unless it is the current default search provider, in
+// which case it is updated with the data from prefs.
+void TemplateURLService::UpdateProvidersCreatedByPolicy(
     TemplateURLVector* template_urls,
-    TemplateURL** default_search_provider,
-    TemplateURLData* default_from_prefs) {
+    const TemplateURLData* default_from_prefs) {
   DCHECK(template_urls);
-  DCHECK(default_search_provider);
+
   for (TemplateURLVector::iterator i = template_urls->begin();
        i != template_urls->end(); ) {
     TemplateURL* template_url = *i;
     if (template_url->created_by_policy()) {
-      if (template_url == *default_search_provider &&
-          is_default_search_managed_ &&
+      if (default_from_prefs &&
           TemplateURL::MatchesData(template_url, default_from_prefs)) {
         // If the database specified a default search provider that was set
         // by policy, and the default search provider from the preferences
         // is also set by policy and they are the same, keep the entry in the
         // database and the |default_search_provider|.
+        default_search_provider_ = template_url;
+        // Prevent us from saving any other entries, or creating a new one.
+        default_from_prefs = NULL;
         ++i;
         continue;
       }
 
-      // The database loaded a managed |default_search_provider|, but it has
-      // been updated in the prefs. Remove it from the database, and update the
-      // |default_search_provider| pointer here.
-      if (*default_search_provider &&
-          (*default_search_provider)->id() == template_url->id())
-        *default_search_provider = NULL;
-
+      RemoveFromMaps(template_url);
       i = template_urls->erase(i);
       if (service_)
         service_->RemoveKeyword(template_url->id());
@@ -2354,6 +2200,18 @@
       ++i;
     }
   }
+
+  if (default_from_prefs) {
+    default_search_provider_ = NULL;
+    default_search_provider_source_ = DefaultSearchManager::FROM_POLICY;
+    TemplateURLData new_data(*default_from_prefs);
+    if (new_data.sync_guid.empty())
+      new_data.sync_guid = base::GenerateGUID();
+    new_data.created_by_policy = true;
+    TemplateURL* new_dse = new TemplateURL(profile_, new_data);
+    if (AddNoNotify(new_dse, true))
+      default_search_provider_ = new_dse;
+  }
 }
 
 void TemplateURLService::ResetTemplateURLGUID(TemplateURL* url,
@@ -2363,9 +2221,8 @@
 
   TemplateURLData data(url->data());
   data.sync_guid = guid;
-  TemplateURL new_url(url->profile(), data);
   UIThreadSearchTermsData search_terms_data(url->profile());
-  UpdateNoNotify(url, new_url, search_terms_data);
+  UpdateNoNotify(url, TemplateURL(profile_, data), search_terms_data);
 }
 
 base::string16 TemplateURLService::UniquifyKeyword(const TemplateURL& turl,
@@ -2436,9 +2293,9 @@
     // Update |applied_sync_turl| in the local model with the new keyword.
     TemplateURLData data(applied_sync_turl->data());
     data.SetKeyword(new_keyword);
-    TemplateURL new_turl(applied_sync_turl->profile(), data);
     UIThreadSearchTermsData search_terms_data(applied_sync_turl->profile());
-    if (UpdateNoNotify(applied_sync_turl, new_turl, search_terms_data))
+    if (UpdateNoNotify(
+            applied_sync_turl, TemplateURL(profile_, data), search_terms_data))
       NotifyObservers();
   }
   // The losing TemplateURL should have their keyword updated. Send a change to
@@ -2487,18 +2344,6 @@
             CreateSyncDataFromTemplateURL(*conflicting_turl);
         change_list->push_back(syncer::SyncChange(
             FROM_HERE, syncer::SyncChange::ACTION_UPDATE, sync_data));
-        if (conflicting_turl == GetDefaultSearchProvider() &&
-            !pending_synced_default_search_) {
-          // If we're not waiting for the Synced default to come in, we should
-          // override the pref with our new GUID. If we are waiting for the
-          // arrival of a synced default, setting the pref here would cause us
-          // to lose the GUID we are waiting on.
-          PrefService* prefs = GetPrefs();
-          if (prefs) {
-            prefs->SetString(prefs::kSyncedDefaultSearchProviderGUID,
-                             conflicting_turl->sync_guid());
-          }
-        }
         // Note that in this case we do not add the Sync TemplateURL to the
         // local model, since we've effectively "merged" it in by updating the
         // local conflicting entry with its sync_guid.
@@ -2523,43 +2368,16 @@
     // Force the local ID to kInvalidTemplateURLID so we can add it.
     TemplateURLData data(sync_turl->data());
     data.id = kInvalidTemplateURLID;
-    Add(new TemplateURL(profile_, data));
+    TemplateURL* added = new TemplateURL(profile_, data);
+    base::AutoReset<DefaultSearchChangeOrigin> change_origin(
+        &dsp_change_origin_, DSP_CHANGE_SYNC_ADD);
+    if (Add(added))
+      MaybeUpdateDSEAfterSync(added);
     merge_result->set_num_items_added(
         merge_result->num_items_added() + 1);
   }
 }
 
-void TemplateURLService::SetDefaultSearchProviderIfNewlySynced(
-    const std::string& guid) {
-  // If we're not syncing or if default search is managed by policy, ignore.
-  if (!sync_processor_.get() || is_default_search_managed_)
-    return;
-
-  PrefService* prefs = GetPrefs();
-  if (prefs && pending_synced_default_search_ &&
-      prefs->GetString(prefs::kSyncedDefaultSearchProviderGUID) == guid) {
-    // Make sure this actually exists. We should not be calling this unless we
-    // really just added this TemplateURL.
-    TemplateURL* turl_from_sync = GetTemplateURLForGUID(guid);
-    if (turl_from_sync && turl_from_sync->SupportsReplacement()) {
-      base::AutoReset<DefaultSearchChangeOrigin> change_origin(
-          &dsp_change_origin_, DSP_CHANGE_SYNC_ADD);
-      SetDefaultSearchProvider(turl_from_sync);
-    }
-    pending_synced_default_search_ = false;
-  }
-}
-
-TemplateURL* TemplateURLService::GetPendingSyncedDefaultSearchProvider() {
-  PrefService* prefs = GetPrefs();
-  if (!prefs || !pending_synced_default_search_)
-    return NULL;
-
-  // Could be NULL if no such thing exists.
-  return GetTemplateURLForGUID(
-      prefs->GetString(prefs::kSyncedDefaultSearchProviderGUID));
-}
-
 void TemplateURLService::PatchMissingSyncGUIDs(
     TemplateURLVector* template_urls) {
   DCHECK(template_urls);
@@ -2577,112 +2395,30 @@
   }
 }
 
-void TemplateURLService::AddTemplateURLsAndSetupDefaultEngine(
-    TemplateURLVector* template_urls,
-    TemplateURL* default_search_provider) {
-  DCHECK(template_urls);
-  is_default_search_managed_ = false;
-  bool database_specified_a_default = (default_search_provider != NULL);
+void TemplateURLService::OnSyncedDefaultSearchProviderGUIDChanged() {
+  base::AutoReset<DefaultSearchChangeOrigin> change_origin(
+      &dsp_change_origin_, DSP_CHANGE_SYNC_PREF);
 
-  // Check if default search provider is now managed.
-  scoped_ptr<TemplateURLData> default_from_prefs;
-  LoadDefaultSearchProviderFromPrefs(
-      GetPrefs(), &default_from_prefs, &is_default_search_managed_);
-
-  // Remove entries that were created because of policy as they may have
-  // changed since the database was saved.
-  RemoveProvidersCreatedByPolicy(template_urls,
-                                 &default_search_provider,
-                                 default_from_prefs.get());
-
-  PatchMissingSyncGUIDs(template_urls);
-
-  if (is_default_search_managed_) {
-    SetTemplateURLs(template_urls);
-
-    if (TemplateURL::MatchesData(default_search_provider,
-                                 default_from_prefs.get())) {
-      // The value from the preferences was previously stored in the database.
-      // Reuse it.
-    } else {
-      // The value from the preferences takes over.
-      default_search_provider = NULL;
-      if (default_from_prefs) {
-        default_from_prefs->created_by_policy = true;
-        default_from_prefs->id = kInvalidTemplateURLID;
-        default_search_provider =
-            new TemplateURL(profile_, *default_from_prefs);
-        if (!AddNoNotify(default_search_provider, true))
-          default_search_provider = NULL;
-      }
-    }
-    // Note that this saves the default search provider to prefs.
-    if (!default_search_provider ||
-        ((default_search_provider->GetType() !=
-            TemplateURL::OMNIBOX_API_EXTENSION) &&
-         default_search_provider->SupportsReplacement())) {
-      bool success = SetDefaultSearchProviderNoNotify(default_search_provider);
-      DCHECK(success);
-    }
-  } else {
-    // If we had a managed default, replace it with the synced default if
-    // applicable, or the first provider of the list.
-    TemplateURL* synced_default = GetPendingSyncedDefaultSearchProvider();
-    if (synced_default) {
-      default_search_provider = synced_default;
-      pending_synced_default_search_ = false;
-    } else if (database_specified_a_default &&
-        default_search_provider == NULL) {
-      UMA_HISTOGRAM_ENUMERATION(kFirstPotentialEngineHistogramName,
-                                FIRST_POTENTIAL_CALLSITE_ON_LOAD,
-                                FIRST_POTENTIAL_CALLSITE_MAX);
-      default_search_provider = FirstPotentialDefaultEngine(*template_urls);
-    }
-
-    // If the default search provider existed previously, then just
-    // set the member variable. Otherwise, we'll set it using the method
-    // to ensure that it is saved properly after its id is set.
-    if (default_search_provider &&
-        (default_search_provider->id() != kInvalidTemplateURLID)) {
-      default_search_provider_ = default_search_provider;
-      default_search_provider = NULL;
-    }
-    SetTemplateURLs(template_urls);
-
-    if (default_search_provider) {
-      base::AutoReset<DefaultSearchChangeOrigin> change_origin(
-          &dsp_change_origin_, default_from_prefs ?
-              dsp_change_origin_ : DSP_CHANGE_NEW_ENGINE_NO_PREFS);
-      // Note that this saves the default search provider to prefs.
-      SetDefaultSearchProvider(default_search_provider);
-    } else {
-      // Always save the default search provider to prefs. That way we don't
-      // have to worry about it being out of sync.
-      if (default_search_provider_)
-        SaveDefaultSearchProviderToPrefs(default_search_provider_, GetPrefs());
-    }
+  std::string new_guid =
+      GetPrefs()->GetString(prefs::kSyncedDefaultSearchProviderGUID);
+  if (new_guid.empty()) {
+    default_search_manager_.ClearUserSelectedDefaultSearchEngine();
+    return;
   }
+
+  TemplateURL* turl = GetTemplateURLForGUID(new_guid);
+  if (turl)
+    default_search_manager_.SetUserSelectedDefaultSearchEngine(turl->data());
 }
 
-void TemplateURLService::EnsureDefaultSearchProviderExists() {
-  if (!is_default_search_managed()) {
-    bool has_default_search_provider = default_search_provider_ &&
-        default_search_provider_->SupportsReplacement();
-    UMA_HISTOGRAM_BOOLEAN("Search.HasDefaultSearchProvider",
-                          has_default_search_provider);
-    // Ensure that default search provider exists. See http://crbug.com/116952.
-    if (!has_default_search_provider) {
-      bool success =
-          SetDefaultSearchProviderNoNotify(FindNewDefaultSearchProvider());
-      DCHECK(success);
-    }
-    // Don't log anything if the user has a NULL default search provider.
-    if (default_search_provider_) {
-      UMA_HISTOGRAM_ENUMERATION("Search.DefaultSearchProviderType",
-          TemplateURLPrepopulateData::GetEngineType(*default_search_provider_),
-          SEARCH_ENGINE_MAX);
-    }
+TemplateURL* TemplateURLService::FindPrepopulatedTemplateURL(
+    int prepopulated_id) {
+  for (TemplateURLVector::const_iterator i = template_urls_.begin();
+       i != template_urls_.end(); ++i) {
+    if ((*i)->prepopulate_id() == prepopulated_id)
+      return *i;
   }
+  return NULL;
 }
 
 TemplateURL* TemplateURLService::CreateTemplateURLForExtension(
@@ -2707,11 +2443,22 @@
         (*i)->GetExtensionId() == extension_id)
       return *i;
   }
-
   return NULL;
 }
 
-TemplateURL* TemplateURLService::FindExtensionDefaultSearchEngine() const {
+TemplateURL* TemplateURLService::FindMatchingExtensionTemplateURL(
+    const TemplateURLData& data,
+    TemplateURL::Type type) {
+  DCHECK_NE(TemplateURL::NORMAL, type);
+  for (TemplateURLVector::const_iterator i = template_urls_.begin();
+       i != template_urls_.end(); ++i) {
+    if ((*i)->GetType() == type && TemplateURL::MatchesData(*i, &data))
+      return *i;
+  }
+  return NULL;
+}
+
+void TemplateURLService::UpdateExtensionDefaultSearchEngine() {
   TemplateURL* most_recently_intalled_default = NULL;
   for (TemplateURLVector::const_iterator i = template_urls_.begin();
        i != template_urls_.end(); ++i) {
@@ -2724,29 +2471,12 @@
       most_recently_intalled_default = *i;
   }
 
-  return most_recently_intalled_default;
-}
-
-void TemplateURLService::
-    SetDefaultSearchProviderAfterRemovingDefaultExtension() {
-  DCHECK(!is_default_search_managed());
-  TemplateURL* new_dse = FindExtensionDefaultSearchEngine();
-  if (!new_dse) {
-    scoped_ptr<TemplateURLData> default_provider;
-    bool is_managed;
-    if (LoadDefaultSearchProviderFromPrefs(
-            GetPrefs(), &default_provider, &is_managed) &&
-        default_provider) {
-      for (TemplateURLVector::const_iterator i = template_urls_.begin();
-           i != template_urls_.end(); ++i) {
-        if ((*i)->id() == default_provider->id) {
-          new_dse = *i;
-          break;
-        }
-      }
-    }
+  if (most_recently_intalled_default) {
+    base::AutoReset<DefaultSearchChangeOrigin> change_origin(
+        &dsp_change_origin_, DSP_CHANGE_OVERRIDE_SETTINGS_EXTENSION);
+    default_search_manager_.SetExtensionControlledDefaultSearchEngine(
+        most_recently_intalled_default->data());
+  } else {
+    default_search_manager_.ClearExtensionControlledDefaultSearchEngine();
   }
-  if (!new_dse)
-    new_dse = FindNewDefaultSearchProvider();
-  SetDefaultSearchProviderNoNotify(new_dse);
 }
diff --git a/chrome/browser/search_engines/template_url_service.h b/chrome/browser/search_engines/template_url_service.h
index 654b25c..8d5f5537 100644
--- a/chrome/browser/search_engines/template_url_service.h
+++ b/chrome/browser/search_engines/template_url_service.h
@@ -137,8 +137,8 @@
 
   // Saves enough of url to |prefs| so that it can be loaded from preferences on
   // start up.
-  void SaveDefaultSearchProviderToPrefs(const TemplateURL* url,
-                                        PrefService* prefs) const;
+  static void SaveDefaultSearchProviderToPrefs(const TemplateURL* url,
+                                               PrefService* prefs);
 
   // Returns true if there is no TemplateURL that conflicts with the
   // keyword/url pair, or there is one but it can be replaced. If there is an
@@ -175,7 +175,8 @@
 
   // Takes ownership of |template_url| and adds it to this model.  For obvious
   // reasons, it is illegal to Add() the same |template_url| pointer twice.
-  void Add(TemplateURL* template_url);
+  // Returns true if the Add is successful.
+  bool Add(TemplateURL* template_url);
 
   // Like Add(), but overwrites the |template_url|'s values with the provided
   // ones.
@@ -261,7 +262,9 @@
   bool IsSearchResultsPageFromDefaultSearchProvider(const GURL& url);
 
   // Returns true if the default search is managed through group policy.
-  bool is_default_search_managed() const { return is_default_search_managed_; }
+  bool is_default_search_managed() const {
+    return default_search_provider_source_ == DefaultSearchManager::FROM_POLICY;
+  }
 
   // Returns true if the default search provider is controlled by an extension.
   bool IsExtensionControlledDefaultSearch();
@@ -384,9 +387,20 @@
   static SyncDataMap CreateGUIDToSyncDataMap(
       const syncer::SyncDataList& sync_data);
 
+  // Indicates whether the pre-populated TemplateURLs should be disabled. May
+  // only be true in tests.
+  static bool fallback_search_engines_disabled() {
+    return g_fallback_search_engines_disabled;
+  }
+
 #if defined(UNIT_TEST)
-  // Set a different time provider function, such as
-  // base::MockTimeProvider::StaticNow, when testing calls to base::Time::Now.
+  // Disables the pre-populated TemplateURLs for testing purposes.
+  static void set_fallback_search_engines_disabled(bool disabled) {
+    g_fallback_search_engines_disabled = disabled;
+  }
+
+  // Sets a different time provider function, such as
+  // base::MockTimeProvider::StaticNow, for testing calls to base::Time::Now.
   void set_time_provider(TimeProvider* time_provider) {
     time_provider_ = time_provider;
   }
@@ -472,8 +486,15 @@
   // Transitions to the loaded state.
   void ChangeToLoadedState();
 
-  // Clears user preferences describing the default search engine.
-  void ClearDefaultProviderFromPrefs();
+  // Called by DefaultSearchManager when the effective default search engine has
+  // changed.
+  void OnDefaultSearchChange(const TemplateURLData* new_dse_data,
+                             DefaultSearchManager::Source source);
+
+  // Applies a DSE change. May be called at startup or after transitioning to
+  // the loaded state.
+  void ApplyDefaultSearchChange(const TemplateURLData* new_dse_data,
+                                DefaultSearchManager::Source source);
 
   // Returns true if there is no TemplateURL that has a search url with the
   // specified host, or the only TemplateURLs matching the specified host can
@@ -510,6 +531,11 @@
   static void UpdateTemplateURLIfPrepopulated(TemplateURL* existing_turl,
                                               Profile* profile);
 
+  // If the TemplateURL's sync GUID matches the kSyncedDefaultSearchProviderGUID
+  // preference it will be used to update the DSE in memory and as persisted in
+  // preferences.
+  void MaybeUpdateDSEAfterSync(TemplateURL* synced_turl);
+
   // Returns the preferences we use.
   PrefService* GetPrefs();
 
@@ -527,26 +553,6 @@
   // {google:baseSuggestURL}.
   void GoogleBaseURLChanged(const GURL& old_base_url);
 
-  // Update the default search.  Called at initialization or when a managed
-  // preference has changed.
-  void UpdateDefaultSearch();
-
-  // Set the default search provider.  |url| may be user-selected or
-  // automatically selected and may be null.
-  // This will assert if the default search is managed.
-  void SetDefaultSearchProvider(TemplateURL* url);
-
-  // Set the default search provider even if it is managed. |url| may be null.
-  // Caller is responsible for notifying observers.  Returns whether |url| was
-  // found in |template_urls_|.
-  // If |url| is an extension-controlled search engine then preferences and the
-  // database are left untouched.
-  // If |url| is a normal search engine and the existing default search engine
-  // is controlled by an extension then |url| is propagated to the database and
-  // prefs but the extension-controlled default engine will continue to hide
-  // this value until the extension is uninstalled.
-  bool SetDefaultSearchProviderNoNotify(TemplateURL* url);
-
   // Adds a new TemplateURL to this model. TemplateURLService will own the
   // reference, and delete it when the TemplateURL is removed.
   // If |newly_adding| is false, we assume that this TemplateURL was already
@@ -575,14 +581,12 @@
   // model is loaded.
   void NotifyObservers();
 
-  // Removes from the vector any template URL that was created because of
-  // policy.  These TemplateURLs are freed and removed from the database.
-  // Sets default_search_provider to NULL if it was one of them, unless it is
-  // the same as the current default from preferences and it is managed.
-  void RemoveProvidersCreatedByPolicy(
+  // Updates |template_urls| so that the only "created by policy" entry is
+  // |default_from_prefs|. |default_from_prefs| may be NULL if there is no
+  // policy-defined DSE in effect.
+  void UpdateProvidersCreatedByPolicy(
       TemplateURLVector* template_urls,
-      TemplateURL** default_search_provider,
-      TemplateURLData* default_from_prefs);
+      const TemplateURLData* default_from_prefs);
 
   // Resets the sync GUID of the specified TemplateURL and persists the change
   // to the database. This does not notify observers.
@@ -640,14 +644,6 @@
                               SyncDataMap* local_data,
                               syncer::SyncMergeResult* merge_result);
 
-  // Checks a newly added TemplateURL from Sync by its sync_guid and sets it as
-  // the default search provider if we were waiting for it.
-  void SetDefaultSearchProviderIfNewlySynced(const std::string& guid);
-
-  // Retrieve the pending default search provider according to Sync. Returns
-  // NULL if there was no pending search provider from Sync.
-  TemplateURL* GetPendingSyncedDefaultSearchProvider();
-
   // Goes through a vector of TemplateURLs and ensure that both the in-memory
   // and database copies have valid sync_guids. This is to fix crbug.com/102038,
   // where old entries were being pushed to Sync without a sync_guid.
@@ -655,40 +651,34 @@
 
   void OnSyncedDefaultSearchProviderGUIDChanged();
 
-  // Adds |template_urls| to |template_urls_| and sets up the default search
-  // provider.  If |default_search_provider| is non-NULL, it must refer to one
-  // of the |template_urls|, and will be used as the new default.
+  // Adds |template_urls| to |template_urls_|.
   //
   // This transfers ownership of the elements in |template_urls| to |this|, and
   // may delete some elements, so it's not safe for callers to access any
   // elements after calling; to reinforce this, this function clears
   // |template_urls| on exit.
-  void AddTemplateURLsAndSetupDefaultEngine(
-      TemplateURLVector* template_urls,
-      TemplateURL* default_search_provider);
-
-  // If there is no current default search provider, sets the default to the
-  // result of calling FindNewDefaultSearchProvider().
-  void EnsureDefaultSearchProviderExists();
+  void AddTemplateURLs(TemplateURLVector* template_urls);
 
   // Returns a new TemplateURL for the given extension.
   TemplateURL* CreateTemplateURLForExtension(
       const ExtensionKeyword& extension_keyword);
 
+  // Returns the TemplateURL corresponding to |prepopulated_id|, if any.
+  TemplateURL* FindPrepopulatedTemplateURL(int prepopulated_id);
+
   // Returns the TemplateURL associated with |extension_id|, if any.
   TemplateURL* FindTemplateURLForExtension(const std::string& extension_id,
                                            TemplateURL::Type type);
 
-  // Finds the most recently-installed NORMAL_CONTROLLED_BY_EXTENSION engine
-  // that supports replacement and wants to be default, if any.
-  TemplateURL* FindExtensionDefaultSearchEngine() const;
+  // Finds the extension-supplied TemplateURL that matches |data|, if any.
+  TemplateURL* FindMatchingExtensionTemplateURL(const TemplateURLData& data,
+                                                TemplateURL::Type type);
 
-  // Sets the default search provider to:
-  // (1) BestDefaultExtensionControlledTURL(), if any; or,
-  // (2) LoadDefaultSearchProviderFromPrefs(), if we have a TURL with that ID;
-  // or,
-  // (3) FindNewDefaultSearchProvider().
-  void SetDefaultSearchProviderAfterRemovingDefaultExtension();
+  // Finds the most recently-installed NORMAL_CONTROLLED_BY_EXTENSION engine
+  // that supports replacement and wants to be default, if any. Notifies the
+  // DefaultSearchManager, which might change the effective default search
+  // engine.
+  void UpdateExtensionDefaultSearchEngine();
 
   content::NotificationRegistrar notification_registrar_;
   PrefChangeRegistrar pref_change_registrar_;
@@ -735,12 +725,12 @@
   // TemplateURL owned by |template_urls_|.
   TemplateURL* default_search_provider_;
 
-  // The initial search provider extracted from preferences. This is only valid
-  // if we haven't been loaded or loading failed.
+  // A temporary location for the DSE until Web Data has been loaded and it can
+  // be merged into |template_urls_|.
   scoped_ptr<TemplateURL> initial_default_search_provider_;
 
-  // Whether the default search is managed via policy.
-  bool is_default_search_managed_;
+  // Source of the default search provider.
+  DefaultSearchManager::Source default_search_provider_source_;
 
   // ID assigned to next TemplateURL added to this model. This is an ever
   // increasing integer that is initialized from the database.
@@ -765,13 +755,6 @@
   // Sync's error handler. We use it to create a sync error.
   scoped_ptr<syncer::SyncErrorFactory> sync_error_factory_;
 
-  // Whether or not we are waiting on the default search provider to come in
-  // from Sync. This is to facilitate the fact that changes to the value of
-  // prefs::kSyncedDefaultSearchProviderGUID do not always come before the
-  // TemplateURL entry it refers to, and to handle the case when we want to use
-  // the Synced default when the default search provider becomes unmanaged.
-  bool pending_synced_default_search_;
-
   // A set of sync GUIDs denoting TemplateURLs that have been removed from this
   // model or the underlying WebDataService prior to MergeDataAndStartSyncing.
   // This set is used to determine what entries from the server we want to
@@ -789,6 +772,9 @@
   // Helper class to manage the default search engine.
   DefaultSearchManager default_search_manager_;
 
+  // Used to disable the prepopulated search engines in tests.
+  static bool g_fallback_search_engines_disabled;
+
   DISALLOW_COPY_AND_ASSIGN(TemplateURLService);
 };
 
diff --git a/chrome/browser/search_engines/template_url_service_sync_unittest.cc b/chrome/browser/search_engines/template_url_service_sync_unittest.cc
index d0ec2d9..60a18ba 100644
--- a/chrome/browser/search_engines/template_url_service_sync_unittest.cc
+++ b/chrome/browser/search_engines/template_url_service_sync_unittest.cc
@@ -230,6 +230,7 @@
           sync_processor_.get())) {}
 
 void TemplateURLServiceSyncTest::SetUp() {
+  TemplateURLService::set_fallback_search_engines_disabled(true);
   test_util_a_.SetUp();
   // Use ChangeToLoadState() instead of VerifyLoad() so we don't actually pull
   // in the prepopulate data, which the sync tests don't care about (and would
@@ -244,6 +245,7 @@
 
 void TemplateURLServiceSyncTest::TearDown() {
   test_util_a_.TearDown();
+  TemplateURLService::set_fallback_search_engines_disabled(false);
 }
 
 scoped_ptr<syncer::SyncChangeProcessor>
@@ -1634,41 +1636,6 @@
   ASSERT_EQ(default_search, model()->GetDefaultSearchProvider());
 }
 
-TEST_F(TemplateURLServiceSyncTest, NewDefaultIsAlreadySynced) {
-  // Ensure that if the synced DSP pref changed to another synced entry (as
-  // opposed to coming in as a new entry), it gets reset correctly.
-  // Start by setting kSyncedDefaultSearchProviderGUID to the entry that should
-  // end up as the default. Note that this must be done before the initial
-  // entries are added as otherwise this call will set the DSP immediately.
-  profile_a()->GetTestingPrefService()->SetString(
-      prefs::kSyncedDefaultSearchProviderGUID, "key2");
-
-  syncer::SyncDataList initial_data = CreateInitialSyncData();
-  // Ensure that our candidate default supports replacement.
-  scoped_ptr<TemplateURL> turl(CreateTestTemplateURL(ASCIIToUTF16("key2"),
-      "http://key2.com/{searchTerms}", "key2", 90));
-  initial_data[1] = TemplateURLService::CreateSyncDataFromTemplateURL(*turl);
-  for (syncer::SyncDataList::const_iterator iter = initial_data.begin();
-      iter != initial_data.end(); ++iter) {
-    TemplateURL* converted = Deserialize(*iter);
-    model()->Add(converted);
-  }
-
-  // Set the initial default to something other than the desired default.
-  model()->SetUserSelectedDefaultSearchProvider(
-      model()->GetTemplateURLForGUID("key1"));
-
-  // Merge in the same data (i.e. already synced entries).
-  model()->MergeDataAndStartSyncing(syncer::SEARCH_ENGINES, initial_data,
-      PassProcessor(), CreateAndPassSyncErrorFactory());
-
-  EXPECT_EQ(3U, model()->GetAllSyncData(syncer::SEARCH_ENGINES).size());
-  TemplateURL* current_default = model()->GetDefaultSearchProvider();
-  ASSERT_TRUE(current_default);
-  EXPECT_EQ("key2", current_default->sync_guid());
-  EXPECT_EQ(ASCIIToUTF16("key2"), current_default->keyword());
-}
-
 TEST_F(TemplateURLServiceSyncTest, SyncWithManagedDefaultSearch) {
   // First start off with a few entries and make sure we can set an unmanaged
   // default search provider.
@@ -2249,3 +2216,25 @@
   EXPECT_EQ(default_turl->short_name, result_turl->short_name());
   EXPECT_EQ(default_turl->url(), result_turl->url());
 }
+
+TEST_F(TemplateURLServiceSyncTest, GUIDUpdatedOnDefaultSearchChange) {
+  const char kGUID[] = "initdefault";
+  model()->Add(CreateTestTemplateURL(ASCIIToUTF16("what"),
+                                     "http://thewhat.com/{searchTerms}",
+                                     kGUID));
+  model()->SetUserSelectedDefaultSearchProvider(
+      model()->GetTemplateURLForGUID(kGUID));
+
+  const TemplateURL* default_search = model()->GetDefaultSearchProvider();
+  ASSERT_TRUE(default_search);
+
+  const char kNewGUID[] = "newdefault";
+  model()->Add(CreateTestTemplateURL(ASCIIToUTF16("what"),
+                                     "http://thewhat.com/{searchTerms}",
+                                     kNewGUID));
+  model()->SetUserSelectedDefaultSearchProvider(
+      model()->GetTemplateURLForGUID(kNewGUID));
+
+  EXPECT_EQ(kNewGUID, profile_a()->GetTestingPrefService()->GetString(
+      prefs::kSyncedDefaultSearchProviderGUID));
+}
diff --git a/chrome/browser/search_engines/template_url_service_test_util.cc b/chrome/browser/search_engines/template_url_service_test_util.cc
index c5e15e33..cf6daf8 100644
--- a/chrome/browser/search_engines/template_url_service_test_util.cc
+++ b/chrome/browser/search_engines/template_url_service_test_util.cc
@@ -6,9 +6,11 @@
 
 #include "base/bind.h"
 #include "base/run_loop.h"
+#include "base/strings/string_split.h"
 #include "base/threading/thread.h"
 #include "chrome/browser/chrome_notification_types.h"
 #include "chrome/browser/google/google_url_tracker.h"
+#include "chrome/browser/search_engines/default_search_manager.h"
 #include "chrome/browser/search_engines/search_terms_data.h"
 #include "chrome/browser/search_engines/template_url_service.h"
 #include "chrome/browser/search_engines/template_url_service_factory.h"
@@ -144,55 +146,56 @@
     const std::string& encodings,
     const std::string& alternate_url,
     const std::string& search_terms_replacement_key) {
-  if (enabled) {
-    EXPECT_FALSE(keyword.empty());
-    EXPECT_FALSE(search_url.empty());
-  }
   TestingPrefServiceSyncable* pref_service = profile()->GetTestingPrefService();
-  pref_service->SetManagedPref(prefs::kDefaultSearchProviderEnabled,
-                               base::Value::CreateBooleanValue(enabled));
-  pref_service->SetManagedPref(prefs::kDefaultSearchProviderName,
-                               base::Value::CreateStringValue(name));
-  pref_service->SetManagedPref(prefs::kDefaultSearchProviderKeyword,
-                               base::Value::CreateStringValue(keyword));
-  pref_service->SetManagedPref(prefs::kDefaultSearchProviderSearchURL,
-                               base::Value::CreateStringValue(search_url));
-  pref_service->SetManagedPref(prefs::kDefaultSearchProviderSuggestURL,
-                               base::Value::CreateStringValue(suggest_url));
-  pref_service->SetManagedPref(prefs::kDefaultSearchProviderIconURL,
-                               base::Value::CreateStringValue(icon_url));
-  pref_service->SetManagedPref(prefs::kDefaultSearchProviderEncodings,
-                               base::Value::CreateStringValue(encodings));
+  scoped_ptr<base::DictionaryValue> value(new base::DictionaryValue);
+  if (!enabled) {
+    value->SetBoolean(DefaultSearchManager::kDisabledByPolicy, true);
+    pref_service->SetManagedPref(
+        DefaultSearchManager::kDefaultSearchProviderDataPrefName,
+        value.release());
+    return;
+  }
+
+  EXPECT_FALSE(keyword.empty());
+  EXPECT_FALSE(search_url.empty());
+  value->Set(DefaultSearchManager::kShortName,
+             base::Value::CreateStringValue(name));
+  value->Set(DefaultSearchManager::kKeyword,
+             base::Value::CreateStringValue(keyword));
+  value->Set(DefaultSearchManager::kURL,
+             base::Value::CreateStringValue(search_url));
+  value->Set(DefaultSearchManager::kSuggestionsURL,
+             base::Value::CreateStringValue(suggest_url));
+  value->Set(DefaultSearchManager::kFaviconURL,
+             base::Value::CreateStringValue(icon_url));
+  value->Set(DefaultSearchManager::kSearchTermsReplacementKey,
+             base::Value::CreateStringValue(search_terms_replacement_key));
+
+  std::vector<std::string> encodings_items;
+  base::SplitString(encodings, ';', &encodings_items);
+  scoped_ptr<base::ListValue> encodings_list(new base::ListValue);
+  for (std::vector<std::string>::const_iterator it = encodings_items.begin();
+       it != encodings_items.end();
+       ++it) {
+    encodings_list->AppendString(*it);
+  }
+  value->Set(DefaultSearchManager::kInputEncodings, encodings_list.release());
+
   scoped_ptr<base::ListValue> alternate_url_list(new base::ListValue());
   if (!alternate_url.empty())
     alternate_url_list->Append(base::Value::CreateStringValue(alternate_url));
-  pref_service->SetManagedPref(prefs::kDefaultSearchProviderAlternateURLs,
-                               alternate_url_list.release());
+  value->Set(DefaultSearchManager::kAlternateURLs,
+             alternate_url_list.release());
+
   pref_service->SetManagedPref(
-      prefs::kDefaultSearchProviderSearchTermsReplacementKey,
-      base::Value::CreateStringValue(search_terms_replacement_key));
-  model()->Observe(chrome::NOTIFICATION_DEFAULT_SEARCH_POLICY_CHANGED,
-                   content::NotificationService::AllSources(),
-                   content::NotificationService::NoDetails());
+      DefaultSearchManager::kDefaultSearchProviderDataPrefName,
+      value.release());
 }
 
 void TemplateURLServiceTestUtilBase::RemoveManagedDefaultSearchPreferences() {
   TestingPrefServiceSyncable* pref_service = profile()->GetTestingPrefService();
-  pref_service->RemoveManagedPref(prefs::kDefaultSearchProviderEnabled);
-  pref_service->RemoveManagedPref(prefs::kDefaultSearchProviderName);
-  pref_service->RemoveManagedPref(prefs::kDefaultSearchProviderKeyword);
-  pref_service->RemoveManagedPref(prefs::kDefaultSearchProviderSearchURL);
-  pref_service->RemoveManagedPref(prefs::kDefaultSearchProviderSuggestURL);
-  pref_service->RemoveManagedPref(prefs::kDefaultSearchProviderIconURL);
-  pref_service->RemoveManagedPref(prefs::kDefaultSearchProviderEncodings);
-  pref_service->RemoveManagedPref(prefs::kDefaultSearchProviderAlternateURLs);
   pref_service->RemoveManagedPref(
-      prefs::kDefaultSearchProviderSearchTermsReplacementKey);
-  pref_service->RemoveManagedPref(prefs::kDefaultSearchProviderID);
-  pref_service->RemoveManagedPref(prefs::kDefaultSearchProviderPrepopulateID);
-  model()->Observe(chrome::NOTIFICATION_DEFAULT_SEARCH_POLICY_CHANGED,
-                   content::NotificationService::AllSources(),
-                   content::NotificationService::NoDetails());
+      DefaultSearchManager::kDefaultSearchProviderDataPrefName);
 }
 
 TemplateURLService* TemplateURLServiceTestUtilBase::model() const {
diff --git a/chrome/browser/search_engines/template_url_service_unittest.cc b/chrome/browser/search_engines/template_url_service_unittest.cc
index 5237b7e..3f2ef59 100644
--- a/chrome/browser/search_engines/template_url_service_unittest.cc
+++ b/chrome/browser/search_engines/template_url_service_unittest.cc
@@ -187,20 +187,6 @@
   TemplateURL* CreatePreloadedTemplateURL(bool safe_for_autoreplace,
                                           int prepopulate_id);
 
-  // Creates a TemplateURL with the same prepopulated id as a real prepopulated
-  // item. The input number determines which prepopulated item. The caller is
-  // responsible for owning the returned TemplateURL*.
-  TemplateURL* CreateReplaceablePreloadedTemplateURL(
-      bool safe_for_autoreplace,
-      size_t index_offset_from_default,
-      base::string16* prepopulated_display_url);
-
-  // Verifies the behavior of when a preloaded url later gets changed.
-  // Since the input is the offset from the default, when one passes in
-  // 0, it tests the default. Passing in a number > 0 will verify what
-  // happens when a preloaded url that is not the default gets updated.
-  void TestLoadUpdatingPreloadedURL(size_t index_offset_from_default);
-
   // Helper methods to make calling TemplateURLServiceTestUtil methods less
   // visually noisy in the test code.
   void VerifyObserverCount(int expected_changed_count);
@@ -243,6 +229,21 @@
   DISALLOW_COPY_AND_ASSIGN(TemplateURLServiceTest);
 };
 
+class TemplateURLServiceWithoutFallbackTest : public TemplateURLServiceTest {
+ public:
+  TemplateURLServiceWithoutFallbackTest() : TemplateURLServiceTest() {}
+
+  virtual void SetUp() OVERRIDE {
+    TemplateURLService::set_fallback_search_engines_disabled(true);
+    TemplateURLServiceTest::SetUp();
+  }
+
+  virtual void TearDown() OVERRIDE {
+    TemplateURLServiceTest::TearDown();
+    TemplateURLService::set_fallback_search_engines_disabled(false);
+  }
+};
+
 TemplateURLServiceTest::TemplateURLServiceTest() {
 }
 
@@ -306,64 +307,6 @@
   return new TemplateURL(test_util_.profile(), data);
 }
 
-TemplateURL* TemplateURLServiceTest::CreateReplaceablePreloadedTemplateURL(
-    bool safe_for_autoreplace,
-    size_t index_offset_from_default,
-    base::string16* prepopulated_display_url) {
-  size_t default_search_provider_index = 0;
-  ScopedVector<TemplateURLData> prepopulated_urls =
-      TemplateURLPrepopulateData::GetPrepopulatedEngines(
-          test_util_.profile()->GetPrefs(), &default_search_provider_index);
-  EXPECT_LT(index_offset_from_default, prepopulated_urls.size());
-  size_t prepopulated_index = (default_search_provider_index +
-      index_offset_from_default) % prepopulated_urls.size();
-  TemplateURL* t_url = CreatePreloadedTemplateURL(safe_for_autoreplace,
-      prepopulated_urls[prepopulated_index]->prepopulate_id);
-  *prepopulated_display_url =
-      TemplateURL(NULL, *prepopulated_urls[prepopulated_index]).url_ref().
-          DisplayURL();
-  return t_url;
-}
-
-void TemplateURLServiceTest::TestLoadUpdatingPreloadedURL(
-    size_t index_offset_from_default) {
-  base::string16 prepopulated_url;
-  TemplateURL* t_url = CreateReplaceablePreloadedTemplateURL(false,
-      index_offset_from_default, &prepopulated_url);
-
-  base::string16 original_url = t_url->url_ref().DisplayURL();
-  std::string original_guid = t_url->sync_guid();
-  EXPECT_NE(prepopulated_url, original_url);
-
-  // Then add it to the model and save it all.
-  test_util_.ChangeModelToLoadState();
-  model()->Add(t_url);
-  const TemplateURL* keyword_url =
-      model()->GetTemplateURLForKeyword(ASCIIToUTF16("unittest"));
-  ASSERT_TRUE(keyword_url != NULL);
-  EXPECT_EQ(t_url, keyword_url);
-  EXPECT_EQ(original_url, keyword_url->url_ref().DisplayURL());
-  base::RunLoop().RunUntilIdle();
-
-  // Now reload the model and verify that the merge updates the url, and
-  // preserves the sync GUID.
-  test_util_.ResetModel(true);
-  keyword_url = model()->GetTemplateURLForKeyword(ASCIIToUTF16("unittest"));
-  ASSERT_TRUE(keyword_url != NULL);
-  EXPECT_EQ(prepopulated_url, keyword_url->url_ref().DisplayURL());
-  EXPECT_EQ(original_guid, keyword_url->sync_guid());
-
-  // Wait for any saves to finish.
-  base::RunLoop().RunUntilIdle();
-
-  // Reload the model to verify that change was saved correctly.
-  test_util_.ResetModel(true);
-  keyword_url = model()->GetTemplateURLForKeyword(ASCIIToUTF16("unittest"));
-  ASSERT_TRUE(keyword_url != NULL);
-  EXPECT_EQ(prepopulated_url, keyword_url->url_ref().DisplayURL());
-  EXPECT_EQ(original_guid, keyword_url->sync_guid());
-}
-
 void TemplateURLServiceTest::VerifyObserverCount(int expected_changed_count) {
   EXPECT_EQ(expected_changed_count, test_util_.GetObserverCount());
   test_util_.ResetObserverCount();
@@ -1049,11 +992,11 @@
   }
 }
 
-TEST_F(TemplateURLServiceTest, ChangeGoogleBaseValue) {
-  // NOTE: Do not do a VerifyLoad() here as it will load the prepopulate data,
-  // which also has a {google:baseURL} keyword in it, which will confuse this
-  // test.
+TEST_F(TemplateURLServiceWithoutFallbackTest, ChangeGoogleBaseValue) {
+  // NOTE: Do not load the prepopulate data, which also has a {google:baseURL}
+  // keyword in it and would confuse this test.
   test_util_.ChangeModelToLoadState();
+
   test_util_.SetGoogleBaseURL(GURL("http://google.com/"));
   const TemplateURL* t_url = AddKeywordWithDate(
       "name", "google.com", "{google:baseURL}?q={searchTerms}", "http://sugg1",
@@ -1230,42 +1173,6 @@
   AssertEquals(*cloned_url, *default_search);
 }
 
-TEST_F(TemplateURLServiceTest, FindNewDefaultSearchProvider) {
-  // Ensure that if our service is initially empty, we don't initial have a
-  // valid new DSP.
-  EXPECT_FALSE(model()->FindNewDefaultSearchProvider());
-
-  // Add a few entries with searchTerms, but ensure only the last one is in the
-  // default list.
-  AddKeywordWithDate("name1", "key1", "http://foo1/{searchTerms}",
-                     "http://sugg1", std::string(), "http://icon1", true,
-                     "UTF-8;UTF-16", Time(), Time());
-  AddKeywordWithDate("name2", "key2", "http://foo2/{searchTerms}",
-                     "http://sugg2", std::string(), "http://icon1", true,
-                     "UTF-8;UTF-16", Time(), Time());
-  AddKeywordWithDate("name3", "key3", "http://foo1/{searchTerms}",
-                     "http://sugg3", std::string(), "http://icon3", true,
-                     "UTF-8;UTF-16", Time(), Time());
-  TemplateURLData data;
-  data.short_name = ASCIIToUTF16("valid");
-  data.SetKeyword(ASCIIToUTF16("validkeyword"));
-  data.SetURL("http://valid/{searchTerms}");
-  data.favicon_url = GURL("http://validicon");
-  data.show_in_default_list = true;
-  TemplateURL* valid_turl(new TemplateURL(test_util_.profile(), data));
-  model()->Add(valid_turl);
-  EXPECT_EQ(4U, model()->GetTemplateURLs().size());
-
-  // Request a new DSP from the service and only expect the valid one.
-  TemplateURL* new_default = model()->FindNewDefaultSearchProvider();
-  ASSERT_TRUE(new_default);
-  EXPECT_EQ(valid_turl, new_default);
-
-  // Remove the default we received and ensure that the service returns NULL.
-  model()->Remove(new_default);
-  EXPECT_FALSE(model()->FindNewDefaultSearchProvider());
-}
-
 // Make sure that the load routine doesn't delete
 // prepopulated engines that no longer exist in the prepopulate data if
 // it is the default search provider.
@@ -1311,37 +1218,13 @@
   }
 }
 
-// Make sure that the load routine updates the url of a preexisting
-// default search engine provider and that the result is saved correctly.
-TEST_F(TemplateURLServiceTest, LoadUpdatesDefaultSearchURL) {
-  TestLoadUpdatingPreloadedURL(0);
-}
-
-// Make sure that the load routine updates the url of a preexisting
-// non-default search engine provider and that the result is saved correctly.
-TEST_F(TemplateURLServiceTest, LoadUpdatesSearchURL) {
-  TestLoadUpdatingPreloadedURL(1);
-}
-
 // Make sure that the load routine sets a default search provider if it was
 // missing and not managed.
 TEST_F(TemplateURLServiceTest, LoadEnsuresDefaultSearchProviderExists) {
   // Force the model to load and make sure we have a default search provider.
   test_util_.VerifyLoad();
-  TemplateURL* old_default = model()->GetDefaultSearchProvider();
-  EXPECT_TRUE(old_default);
+  EXPECT_TRUE(model()->GetDefaultSearchProvider());
 
-  // Now remove it.
-  model()->SetUserSelectedDefaultSearchProvider(NULL);
-  model()->Remove(old_default);
-  base::RunLoop().RunUntilIdle();
-
-  EXPECT_FALSE(model()->GetDefaultSearchProvider());
-
-  // Reset the model and load it. There should be a default search provider.
-  test_util_.ResetModel(true);
-
-  ASSERT_TRUE(model()->GetDefaultSearchProvider());
   EXPECT_TRUE(model()->GetDefaultSearchProvider()->SupportsReplacement());
 
   // Make default search provider unusable (no search terms).
@@ -1459,10 +1342,10 @@
   EXPECT_FALSE(model()->is_default_search_managed());
   EXPECT_EQ(initial_count + 1, model()->GetTemplateURLs().size());
 
-  // The default should now be the first URL added
+  // The default should now be the user preference.
   const TemplateURL* actual_final_managed_default =
       model()->GetDefaultSearchProvider();
-  ExpectSimilar(model()->GetTemplateURLs()[0], actual_final_managed_default);
+  ExpectSimilar(regular_default, actual_final_managed_default);
   EXPECT_EQ(actual_final_managed_default->show_in_default_list(), true);
 
   // Disable the default search provider through policy.
diff --git a/chrome/browser/search_engines/util.cc b/chrome/browser/search_engines/util.cc
index afb3a53..5378b3b 100644
--- a/chrome/browser/search_engines/util.cc
+++ b/chrome/browser/search_engines/util.cc
@@ -98,8 +98,16 @@
     UncheckedURLMap::iterator best = unchecked_urls.begin();
     bool matched_keyword = false;
     for (UncheckedURLMap::iterator i = unchecked_urls.begin(); i != end; ++i) {
-      // A URL is automatically the best if it's the default search engine.
-      if (i->second == default_search_provider) {
+      // If the user-selected DSE is a prepopulated engine its properties will
+      // either come from the prepopulation origin or from the user preferences
+      // file (see DefaultSearchManager). Those properties will end up
+      // overwriting whatever we load now anyway. If we are eliminating
+      // duplicates, then, we err on the side of keeping the thing that looks
+      // more like the value we will end up with in the end.
+      if (default_search_provider &&
+          (default_search_provider->prepopulate_id() ==
+              i->second->prepopulate_id()) &&
+          default_search_provider->HasSameKeywordAs(i->second->data())) {
         best = i;
         break;
       }
@@ -191,17 +199,14 @@
     ScopedVector<TemplateURLData>* prepopulated_urls,
     size_t default_search_index,
     TemplateURLService::TemplateURLVector* template_urls,
-    TemplateURL** default_search_provider,
+    TemplateURL* default_search_provider,
     std::set<std::string>* removed_keyword_guids) {
   DCHECK(service == NULL || BrowserThread::CurrentlyOn(BrowserThread::UI));
   DCHECK(prepopulated_urls);
   DCHECK(template_urls);
-  DCHECK(default_search_provider);
 
-  int default_prepopulated_id =
-      (*prepopulated_urls)[default_search_index]->prepopulate_id;
   ActionsFromPrepopulateData actions(CreateActionsFromCurrentPrepopulateData(
-      prepopulated_urls, *template_urls, *default_search_provider));
+      prepopulated_urls, *template_urls, default_search_provider));
 
   // Remove items.
   for (std::vector<TemplateURL*>::iterator i = actions.removed_engines.begin();
@@ -210,7 +215,8 @@
     TemplateURLService::TemplateURLVector::iterator j =
         std::find(template_urls->begin(), template_urls->end(), template_url);
     DCHECK(j != template_urls->end());
-    DCHECK(*j != *default_search_provider);
+    DCHECK(!default_search_provider ||
+           (*j)->prepopulate_id() != default_search_provider->prepopulate_id());
     template_urls->erase(j);
     if (service) {
       service->RemoveKeyword(template_url->id());
@@ -231,8 +237,6 @@
     TemplateURLService::TemplateURLVector::iterator j = std::find(
         template_urls->begin(), template_urls->end(), existing_url.get());
     *j = new TemplateURL(profile, data);
-    if (*default_search_provider == existing_url.get())
-      *default_search_provider = *j;
   }
 
   // Add items.
@@ -242,13 +246,6 @@
        ++it) {
     template_urls->push_back(new TemplateURL(profile, *it));
   }
-
-  if (!*default_search_provider) {
-    // The user had no existing default search provider, so set the
-    // default to the default prepopulated engine.
-    *default_search_provider = FindURLByPrepopulateID(*template_urls,
-                                                      default_prepopulated_id);
-  }
 }
 
 ActionsFromPrepopulateData CreateActionsFromCurrentPrepopulateData(
@@ -302,10 +299,16 @@
   // The block above removed all the URLs from the |id_to_turl| map that were
   // found in the prepopulate data.  Any remaining URLs that haven't been
   // user-edited or made default can be removed from the data store.
+  // We assume that this entry is equivalent to the DSE if its prepopulate ID
+  // and keyword both match. If the prepopulate ID _does_ match all properties
+  // will be replaced with those from |default_search_provider| anyway.
   for (IDMap::iterator i(id_to_turl.begin()); i != id_to_turl.end(); ++i) {
     TemplateURL* template_url = i->second;
     if ((template_url->safe_for_autoreplace()) &&
-        (template_url != default_search_provider))
+        (!default_search_provider ||
+         (template_url->prepopulate_id() !=
+             default_search_provider->prepopulate_id()) ||
+         (template_url->keyword() != default_search_provider->keyword())))
       actions.removed_engines.push_back(template_url);
   }
 
@@ -317,14 +320,12 @@
     WebDataService* service,
     Profile* profile,
     TemplateURLService::TemplateURLVector* template_urls,
-    TemplateURL** default_search_provider,
+    TemplateURL* default_search_provider,
     int* new_resource_keyword_version,
     std::set<std::string>* removed_keyword_guids) {
   DCHECK(service == NULL || BrowserThread::CurrentlyOn(BrowserThread::UI));
   DCHECK(template_urls);
   DCHECK(template_urls->empty());
-  DCHECK(default_search_provider);
-  DCHECK(*default_search_provider == NULL);
   DCHECK_EQ(KEYWORDS_RESULT, result.GetType());
   DCHECK(new_resource_keyword_version);
 
@@ -347,12 +348,6 @@
     template_urls->push_back(new TemplateURL(profile, *i));
   }
 
-  int64 default_search_provider_id = keyword_result.default_search_provider_id;
-  if (default_search_provider_id) {
-    *default_search_provider =
-        GetTemplateURLByID(*template_urls, default_search_provider_id);
-  }
-
   *new_resource_keyword_version = keyword_result.builtin_keyword_version;
   GetSearchProvidersUsingLoadedEngines(service, profile, template_urls,
                                        default_search_provider,
@@ -364,12 +359,11 @@
     WebDataService* service,
     Profile* profile,
     TemplateURLService::TemplateURLVector* template_urls,
-    TemplateURL** default_search_provider,
+    TemplateURL* default_search_provider,
     int* resource_keyword_version,
     std::set<std::string>* removed_keyword_guids) {
   DCHECK(service == NULL || BrowserThread::CurrentlyOn(BrowserThread::UI));
   DCHECK(template_urls);
-  DCHECK(default_search_provider);
   DCHECK(resource_keyword_version);
   PrefService* prefs = profile ? profile->GetPrefs() : NULL;
   size_t default_search_index;
@@ -377,7 +371,7 @@
       TemplateURLPrepopulateData::GetPrepopulatedEngines(prefs,
                                                          &default_search_index);
   RemoveDuplicatePrepopulateIDs(service, prepopulated_urls,
-                                *default_search_provider, template_urls,
+                                default_search_provider, template_urls,
                                 removed_keyword_guids);
 
   const int prepopulate_resource_keyword_version =
diff --git a/chrome/browser/search_engines/util.h b/chrome/browser/search_engines/util.h
index 2b43ce01..994c102 100644
--- a/chrome/browser/search_engines/util.h
+++ b/chrome/browser/search_engines/util.h
@@ -81,21 +81,20 @@
 // prepopulated search providers to result in:
 //  * a set of template_urls (search providers). The caller owns the
 //    TemplateURL* returned in template_urls.
-//  * the default search provider (and if *default_search_provider is not NULL,
-//    it is contained in template_urls).
 //  * whether there is a new resource keyword version (and the value).
 //    |*new_resource_keyword_version| is set to 0 if no new value. Otherwise,
 //    it is the new value.
 // Only pass in a non-NULL value for service if the WebDataService should be
 // updated. If |removed_keyword_guids| is not NULL, any TemplateURLs removed
 // from the keyword table in the WebDataService will have their Sync GUIDs
-// added to it.
+// added to it. |default_search_provider| will be used to prevent removing the
+// current user-selected DSE, regardless of changes in prepopulate data.
 void GetSearchProvidersUsingKeywordResult(
     const WDTypedResult& result,
     WebDataService* service,
     Profile* profile,
     TemplateURLService::TemplateURLVector* template_urls,
-    TemplateURL** default_search_provider,
+    TemplateURL* default_search_provider,
     int* new_resource_keyword_version,
     std::set<std::string>* removed_keyword_guids);
 
@@ -110,7 +109,7 @@
     WebDataService* service,
     Profile* profile,
     TemplateURLService::TemplateURLVector* template_urls,
-    TemplateURL** default_search_provider,
+    TemplateURL* default_search_provider,
     int* resource_keyword_version,
     std::set<std::string>* removed_keyword_guids);