Google and Microsoft Strengths and Weaknesses
One advantage Google may have over Microsoft is public perception. Part of Google's philosophy is "you can make money without doing evil" [source: Google]. Google has built a reputation on innovation and customer service. The company's headquarters -- the Googleplex -- is famous for its unique amenities and offices.
Microsoft used to have a similar reputation. But after years of dominating the operating system marketplace, Microsoft has become the establishment. In 2007 and 2008, Microsoft had to weather a storm of criticism aimed at Windows Vista. Windows Vista suffered from a series of stability problems, security issues and compatibility errors when it was first released. While software patches helped address many of those problems, many people had already decided to avoid the OS and wait for the next generation.
Google's position on the Web is solid. According to the analysis firm Efficient Frontier, Google held 76 percent of the search engine advertisement market in the third quarter of 2008. Gmail, Google's Web-based e-mail, grew 43 percent from 2007 to 2008 [source: Zafra]. In addition to its search engine, Google offers consumers online productivity software, video and photo sharing services and mapping applications. While Google supports offline applications through its Google Gears product, it doesn't produce many desktop applications.
Microsoft has a much stronger hold on the desktop application market. Besides the Windows OS, Microsoft produces the Office suite of productivity software, software for computer servers and the Web browser Internet Explorer. Another important Microsoft product is its line of Xbox consoles and games. The video game market is one area of strength for Microsoft that Google has yet to touch.
If consumers begin to buy inexpensive machines with limited processing power, Google will have an advantage. That's because almost all of its products are Web services. The only piece of software you need to access most of Google's services is a Web browser. In 2008, Google introduced its own browser: Google Chrome. Chrome may be the first step toward a Web-based operating system.
If consumers decide that they prefer to buy the latest and greatest computer hardware, Microsoft has the advantage. Their products tend to have more features because they rely on the computer's native processing power to run. Web services tend to be less complex -- not because the computers running the applications are less powerful but because broadband speeds aren't fast enough for an ideal consumer experience.
