In case you haven’t heard, there are two companies called Microsoft Corp. (NASDAQ: MSFT) and Google Inc. (NASDAQ: GOOG) that really don’t like each other very much. These tech behemoths are battling each other on a dizzying number of fronts in the consumer, government and business markets, the U.S. court system and the court of public opinion.
Let’s examine 10 battles Microsoft and Google fought against each other in 2010.
Google and Microsoft each accused the other of being monopolistic in 2010, with Google, for example, suing to the U.S. Department of the Interior for favoring Microsoft in the bidding for a cloud-based e-mail contract, and Microsoft joining a group that’s trying to block Google’s planned acquisition of a travel software company due to fear that Google would dominate the online travel search market.
Just for good measure, Microsoft also testified against a Google project to scan millions of books and, separately, filed patent complaints against Motorola for its phones based on Google’s Android mobile operating system. Microsoft has worked on softening its stance toward open source software, so the Android lawsuit illustrates just how seriously Microsoft is taking the threat posed by Google’s mobile phone platform.
War for the desktop
Not content with dominating the search market, Google took aim at Microsoft’s signature Windows operating system business by releasing a prototype version of the forthcoming Chrome OS. Google is so confident that it’s reportedly dumping Windows for internal users, supposedly because Microsoft’s OS isn’t secure enough.
While analysts say Chrome OS is no Windows-killer, just yet, that doesn’t mean Microsoft shouldn’t be worried. If Google’s vision of a “100% Web” world comes to fruition, Microsoft may have some catching up to do. But Microsoft’s Tim O’Brien, senior director of the Platform Strategy Group, dismissed Chrome OS in an interview earlier this year, saying “The browser isn’t the operating system. The operating system is desktop Linux and it runs one application and one application only, and that’s Google’s browser.”
Speaking of Web browsers, Microsoft’s Internet Explorer is still the most widely used tool for surfing the Web, and this year Microsoft took a leap forward with the beta of IE9, which is performing well in early HTML5 testing.
But Internet Explorer usage has been going down steadily nearly every month, while Google’s Chrome is nearing 10 per cent market share just two years after its release. With the arrival of the Chrome Web Store, Google is poised for even more growth in 2011.
No modern tech rivalry would be complete without accusations about putting users at risk of viruses and malware. In June, Microsoft accused a Google security researcher of putting Windows customers at risk of “broad attacks” by publishing code that exploits a zero-day vulnerability, after Google security engineer Tavis Ormandy published some proof-of-concept attack code related to a bug affecting Windows XP and Windows Server 2003. Ormandy says he was acting alone, and that Google shouldn’t be blamed. Ormandy also complained about Microsoft’s tendency toward “bug secrecy,” and said he would have been ignored if he had reported the problem without a working exploit.
Separately, Microsoft and Google have criticized each other over an IE8 security flaw that Google had been pushing Microsoft to fix since at least December 2009. Microsoft finally fixed the bug in October of this year, and appeared to make amends with Google.
In many of the battles fought by Microsoft and Google, Microsoft is the market share leader and is simply attempting to avoid losing users to the upstart Google. That is not the case in the smartphone arena. Google’s Android has become one of the three major platforms in the United States, along with the iPhone and BlackBerry. Three hundred thoughsand new Android phones are being activated every day, better than Apple’s iPhone.
Microsoft has completely revamped its mobile platform with Windows Phone 7, but it still has to convince consumers to buy the phones. So far, Microsoft isn’t saying how many have been sold. The pressure is on: Microsoft’s board of directors complained about “loss of market share in the company’s mobile phone business” when it decided not to award CEO Steve Ballmer the full bonus he was eligible for.
While Microsoft has struggled in the mobile world, it still dominates the e-mail and productivity software market with Microsoft Office in much the same way Windows dominates the desktop OS market.
But Google is coming on strong with Google Apps, a cloud-based set of productivity tools including Gmail and Google Docs. Google claims to have signed up more than 3 million businesses, but Gartner estimates that Gmail has captured less than 1% of the enterprise e-mail market.
Battle for the cloud
Despite Google’s lack of market share, the company’s innovations have forced Microsoft to greatly expand its cloud-based offerings. Microsoft is fighting against numerous competitors on the cloud front, including Amazon’s EC2, which Microsoft counters with Windows Azure. The threat from Google Apps is one reason Microsoft is overhauling the cloud-based versions of Office, Exchange and SharePoint with Office 365, which is available in beta and will see a broader release next year.
Consumer e-mail and search
While Microsoft dominates enterprise e-mail and productivity, the battle between Microsoft’s Hotmail and Gmail has been nip and tuck, with each webmail service claiming more than 40 million U.S. users. Microsoft overhauled Hotmail this year with new online editing capabilities for Office documents, and more than two dozen other enhancements for business and home users.
When it comes to Internet search, Google claims about two-thirds of the market, but Microsoft is plotting to improve Bing’s standing by partnering with both Facebook and Yahoo.
Battle for government customers
Google and Microsoft are both going after the lucrative government market for e-mail and office productivity tools, with Google signing up the City of Los Angeles and the U.S. General Services Administration, while Microsoft just announced a 120,000-user cloud deal with the U.S. Department of Agriculture. As mentioned previously, Google sued the U.S. Department of the Interior “after the agency solicited bids for cloud-based e-mail and messaging services [while] specifying that bidders must use Microsoft products,” the IDG News Service reported in November.
One key to winning government business is complying with the Federal Information Security Management Act (FISMA). Microsoft recently gained FISMA certification for its cloud computing data centers, six months after Google, but is still waiting for FISMA approval for hosted Exchange and SharePoint.
The war of words
Finally, let’s take a look at the war of words waged by Microsoft and Google as they try to win the battle of public perception. In May, a Google executive said Microsoft was already too far behind in the cloud apps market, while in November Microsoft said Google is failing in the enterprise.
Google seems to recognize that business customers aren’t ready to give up Microsoft just yet, and has built several products specifically to plug gaps in Microsoft tools. For example, Google built a Gmail message continuity service to make e-mail work during Exchange outages, and “Chrome Frame” to bring pre-IE9 versions of Internet Explorer into the modern age. (Microsoft scoffed that Chrome Frame simply doubles the attack surface of IE8.)
Google has a few successes to crow about when it comes to swaying public opinion. One survey named Google the “world’s most attractive employer,” with Microsoft ranked seventh, and in August Google surpassed Microsoft in an annual Japanese survey of corporate brand perception. Google could even pass Microsoft in market capitalization, as Apple did earlier this year, some observers are speculating.
While a typical IT pro probably deals with Microsoft products more than Google’s, consumers may be more familiar with Google’s messaging because of the way the media covers the companies. According to the Pew Research Center, 11.4 per cent of technology stories focus on Google (compared with 15.1 per cent for Apple) while only three per cent focus on Microsoft.
Now that 2010 is almost over, we can look forward to the Microsoft-Google rivalry ratcheting up even more in 2011.