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Google vs. Microsoft: The Making of an Epic Rivalry

{complink 2294|Google} envy should be sweeping across the technology world. Fourteen years after it was founded, the $38 billion Web search engine giant and online advertising company is still acting like a startup, and although rival {complink 379|Apple Inc.} is the world's biggest enterprise by market value, Google is actually the one that's pushing what I call real vs. incremental innovation.

Apple's iPhone 5 built on the company's legacy of highly successful smartphones and sold out in its first weekend. That was not really surprising; it's become a pattern with Apple and the mystique is wearing thin. Plus, few people see the iPhone 5 as revolutionary. The company's more recent products have mostly been very successful, but not one of them can be said to have indeed broken any new grounds — from the iPod to the iPhone and the iPad, they've all been evolutionary developments on existing products.

Google's strategy has been somewhat similar (for example, the Android operating system and the purchase of Motorola Mobility) but the company has stuff in the works that point to its willingness to devote significant R&D resources to next-generation products and ideas. There are parallels to the Google story at {complink 3426|Microsoft Corp.}, which is also in online advertising, operating systems, tablets, and via its partnership with Nokia, in mobile handsets. Their business models are almost similar, but more on this below.

“Google's mission is to organize the world's information and make it universally accessible and useful,” according to a statement on its Website, but in reality it recognizes no investment boundaries and has financed projects far removed from its core Web search business. It funded the driverless car, which has now received legislative support in three US states, including California, where governor Jerry Brown recently signed a bill authorizing the use of the vehicles following the establishment of specific rules and regulations. Naturally, Brown signed the legislation at Google's headquarters.

Google has even niftier products in development. The company's “smart glasses,” featuring a head-mounted camera and display have wowed celebrities and fascinated ordinary consumers attracted by the idea of using voice command to take pictures, record video, pull up information, and display and control all these simply by tilting the head up or down. The Google smart glasses are not in production yet but prototypes have been seen in public and a few lucky folks have been able to test them.

If Google rolls out commercial versions of the smart glasses in 2014 as promised, many consumers will want them. The queue at retail outlets on its debut might be even longer than any of the extraordinarily long ones we've seen each time Apple launched an iPhone. That's why I believe Google is one of the companies best positioned to take on Apple, because it has clearly shown willingness and ability to compete strongly for market share in its traditional online advertising, mobile operating system and handset markets even while breaking away from the pack by investing in non-traditional markets. Watch the video below for a demonstration of Google smart glasses.

So, here's my prediction for 2013 and beyond. Apple will continue to rule in the tablet PC market but it will be less dominant in smartphones and may even lose market share here. Its story is also getting stale: revenue, profits, and stock price soared again this year and it released a ho hum iPhone, which everybody naturally wants, but what else is new and exciting about Apple? Unless it does something extraordinary — introduce a completely new product or surprise us with a major improvement on an existing device — the more exciting story of 2013 won't be about Apple. I suspect we'll all be more interested in the growing rivalry between two software-giants-turned hardware manufacturers: Google and Microsoft.

Google and Microsoft started out as software companies before branching into hardware. They are direct rivals seeking unorthodox ways to diversify operations and remain vibrant. They've also got legacy products spinning off huge cash they can tap for acquisitions and R&D, and have been willing to step outside their immediate markets to try new things. Inevitably, they have clashed in online advertising and operating systems, and will butt heads in tablets, mobile, and other futuristic products. That's a story worth watching.

35 comments on “Google vs. Microsoft: The Making of an Epic Rivalry

  1. t.alex
    October 4, 2012

    Facebook is rumoured to be making smartphone as well. I am curious how would it fare..

  2. Daniel
    October 5, 2012

    Bolaji, the significant difference between Apple and Google is Apple is trying to modify their existing devices with more features and applications. But Google is diversifying their presents from search engine to web applications, cloud solutions, navigation system, maps, OS, Browser, Mobile and finally with unmanned cars. So in each and every field they are like a start up company.

  3. SP
    October 5, 2012

    The title of the article Google vs Microsoft is so catchy. Yes it would be a story to watch and of course something industry watchers would be very interested in following. But there is a vast difference in both of these company's approaches. Google is best known for their search engine and some software application work. I feel they are learning in how to handle hardware business. Microsoft on the other hand has strong footing in enterprise development. They created a revolution in PCs. As significant or common a PC is to a common man, Microsoft is also so common in software. But no one can deny that their rivalry is an epic to watch for. I guess Apple is playing their cards right and will emerge as winner. But yes its so very difficult to be at the top. You got to keep reinventing and bringing something new to the table.

  4. Daniel
    October 5, 2012

    t.alex, Facebook IPO was totally flop and hence I don’t think they will take one more risk. I heard the same rumors before the IPO openings and that may be exaggerated news to boost the company profile.

  5. mfbertozzi
    October 5, 2012

    As announced yesterday, they have reached 1B users and despite the flop history of their coming into stock market, we could say it doesn't exist, as of today, a social community larger. Sooner or later it is very similar they decide to evaluate other stategies, including to become smartphone producer. After all, they already provide cellular SIM for mobile phone; if you put it inside your phone, you can login into FB, even you don't have any prepaid or postpaid subscription with mobile operators.

  6. mfbertozzi
    October 5, 2012

    Speaking for myself, Google has limited experience in making; their mission, since the beginning, their focus is mainly in managing infos, it doesn't matter from where and from who. There is a long run to go before collecting success in the area of hw “makers”.

  7. SP
    October 5, 2012

    Hi mfbertozzi, so much true what you said.

  8. mfbertozzi
    October 5, 2012

    @SP: nice to hear you agreeing with; we could discuss also about what, in effect, they did or are doing in managing infos, but this is matter out of the article from Bolaji…

  9. t.alex
    October 5, 2012

    Sim for Facebook ? Sounds strange. Any advantage as compared to other telco SIM card ?

  10. Barbara Jorgensen
    October 5, 2012

    Interesting analysis, and a more valid comparison than Facebook vs….well, anyone. Google has moved beyond its roots as a nifty search tool into OS and now hardware…not a conventional path but when we talk about “thinking outside the box” Google should be top of mind. It also seems to be using the capital raised as a public company to expand its marketplace and add shareholder value, whereas Facebook doesn't seem to have any idea where to go beyond an IPO. It used to be a company's success was determined once it went public: (baby billionaires cashing out) that's no longer the end point. It's just the beginning. Google seems to realize this.

  11. FLYINGSCOT
    October 7, 2012

    It is totally perplexing.  I took my daughter to the mall today to buy a notebook.  We visited the Sony and Microsoft stores and I was wowed by their interactive demos of cool new innovative technologies.  Both stores were surprisingly quiet though.  We then went to a packed out Apple store which was basically an order taking machine with no real demos to speak of.  We bought a MacBook Pro.  There was no convincing my daughter otherwise that she had to get a Mac.  Apple has the “coolness” market completely cornered for now and it will need something very special in terms of marketing and technical prowess to really compete.   

  12. bolaji ojo
    October 8, 2012

    Flyingscot, That's the story all around for people all across the globe about Apple. A friend in Africa recently asked me to help him buy the iPad 3. I didn't try to convince him there are viable alternatives that are a lot cheaper and as functional. People talk about the “Apple ecosystem,” which is really nonsense because Apple doesn't offer content. It has apps, most of which are not directly developed by Apple and its online music and video stores don't feature content from Apple either.

    Things like this change slowly but they eventually change. People don't realize it until the change is upon them. We are in the midst of a cultural revolution involving Apple but there are already indications that as some people t want to be a part of the Apple crowd so are there some that are bucking that trend. They don't want to be a part of the crowd. One or two other companies are exploiting that but we can't right now see their dent on the Apple world.

     

  13. mfbertozzi
    October 9, 2012

    @t.alex: well, in my opinion, major plus  is in the fact you don't need any subscription (pre-paid or post-paid); basically, you need only to get it inside your mobile phone and it works. That's all. Of course, it allows a real time connection with FB, then as of today, it doesn't allow voice traffic, as far as I know. I will try to investage more, I'll get back to the community once news are available.

  14. Wale Bakare
    October 9, 2012

    Are users with more than 1 account counted to the 1billion figure? I think is better to diversify those money into hardware rather than rely on per click ads. That would probably give it a valued based assets.

  15. Daniel
    October 10, 2012

    Mfbertozzi, you are right. Google is known for many of internet application and search engines. But recently they had started diversification through mobile market and unmanned automobiles. We know that they had stepped in to mobile market by acquiring Motorola.

  16. Daniel
    October 10, 2012

    mfbertozzi, accessing FB over mobile is possible with most of the Smartphones, irrespective of whether it’s a pre-paid or post paid. But you have a valid data plan; otherwise the service provider won’t allow using data access. Then how FB mobiles are significant when compare with other mobile phones.

  17. mfbertozzi
    October 10, 2012

    @WaleB: well, it is a good point to figure out, definitely. From the provider perspective, even several users did some duplications within the profile, he has to manage the service for the total “records” created. It doesn't matter if records are mapping real or  virtual profiles. That said, we could discuss how is legal or not and for marketing announcement, how is important and appealing to count total profiles instead of limiting only to real profiles.

  18. mfbertozzi
    October 10, 2012

    @Jacob: thanks for agreeing and sharing your thoughts; there is another step to consider and after all, it could sound as news, but it is not a real news; Google has announced its understanding in becoming a player in the finance for providing startups with funds devoted to marketing campaigns. Then horizons are splitting, not easy to say the new ones.

  19. mfbertozzi
    October 10, 2012

    @Jacob: exactly, you can reach socials via smartphone if you have subscribed a pre-paid or post-paid plan with a given operator, including data. The major plus of SIM for FB is in the fact you don't need it and as far as I know, other Internet players are becoming a SIM provider. We will see in the near future what happens.

  20. t.alex
    October 10, 2012

    Has anyone tried the chrome book ? I believe it's one of the direct rival product of google versus Microsoft windows for laptop or desktop. Google bets on chrome OS running off the cloud seems to be an innovative approach.

  21. mfbertozzi
    October 11, 2012

    It is a good point t.alex; I know for example that people which have tried the “no-logo” version a few month ago, told it brings a fascinating and innovative approach, in the sense that you need to tune your customer experience towards cloud instead of in working with stand-alone software. My thoughts went immediately on connection availability and its speed rate. After all, you haven't software installed inside, you haven't a storage hard disk inside, then the network is a key component for the success of the innovative OS from Google.

  22. t.alex
    October 11, 2012

    If I am not wrong it does have some simple storage so that you can do things offline. Nevertheless the chrome seems not making any big impact so far.

  23. mfbertozzi
    October 11, 2012

    @t.alex: you are right; it depends on version from vendors, in general it has a solid mass storage quite small (comparing hd inside netbook or notebook) for allowing, properly, its starting-up; apart that, you work by using cloud paradigm; for now, we are assisting to limited promotions' actions also from vendors which have produced hw based on ChromeOS, I mean Samsung for example; it is quite hard to find it at discounts, sales are really broadcast on-line, instead; other point is about the price, in the range of netbook-notebook; maybe it is quite early for considering what will be the impact on the market, surely, it is another piece of puzzle of Google vs. Microsoft.

  24. Wale Bakare
    October 11, 2012

    Well, Google's strategically placed in internet technology business,  and it has been driven the company greatly.

  25. Wale Bakare
    October 11, 2012

    While Google seems bamboozling its rivals, making all sorts of innovations. One thing remains that is yet to resolve and tackle really well – security. Andorid OS has security lapses, though i dont have Android phone.

  26. t.alex
    October 12, 2012

    This is probably one if the weak points of google as they are too easy with android market. I think Microsoft does have some proper review process to filter out bad apps before it can be available on the store

  27. mfbertozzi
    October 12, 2012

    @WaleB: I agree, in fact they have achieved significant success and business results within multiple market segment; speaking for myself, Microsoft doesn't have a portfolio similar, right now too.

  28. mfbertozzi
    October 12, 2012

    Security is for all players, including G and MS, a strong area. You have told about Android as weakness in charge of G not completely addessed or solved, but I can tell you about the recent statement from Germany Gov, with regard to IE 8; only a few days ago, they have “banned” the browser, due to criticial vulnerability discovered, event IE 8 is one of a recent asset within MS portfolio.

  29. t.alex
    October 13, 2012

    When it comes to IE there are a host of reasons people avoid using it 🙂 It is typically slowing down the machine after a while.

  30. mfbertozzi
    October 14, 2012

    @t.alex: well…this case wasn't a matter of performance; it seems the hole was/is related to security and MS suggested to adopt their mitigation tool; hereinfafter the case; the discussion, right now, opens a new horizon concerning G vs MS and it is about browser: G vs MS means Chrome vs IE.

  31. Daniel
    October 15, 2012

    Mfbertozzi, you meant through FB mobile, anybody can access their face book account without any active data plan. Then it's amazing and I would be one of the early user.

  32. mfbertozzi
    October 16, 2012

    @Jacob: well, I am really catching what you are meaning; believe it or not, the service is already available and depending you local agreement involving Facebook and your local mobile providers, you can easily use it, here is the link that describers how it works.

  33. Daniel
    October 26, 2012

    Mfbertozzi, thanks for the link. It seems like a very convenient service based on message.

  34. mfbertozzi
    October 27, 2012

    @Jacob: well, more than welcome ! As of today, it appears other players in the area of “social” are evaluating same approach for increasing their footprint in the market. After all, it should be also a tool for providing digital identity services or for cross connect your individual profile to an electronic portfolio for allowing e-payments. Also in this area Google looks strong, its e-wallet has started the services a couple of years ago at least…

  35. Shelly
    October 29, 2012

    Security is a serious defect of Google Android system, especially for the female who are likely being traced. But the new launed iPhone 5 realy lacks revolutionary innovation。 It seems the newly launched products including ipad mini are following the trend, larger or smaller screen size, high resolution; in recent few years, Apple may will keep leading advantage, but if still without big innovation, competing with Google free Android system and huge market shares as well as the innovation in various industries, Apple is dangerous.

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