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 had a similar reputation. But after years of dominating the operating system marketplace, Microsoft has become the establishment. Microsoft has received brutal criticism for some of its releases over the years, including problems with stability, security and compatibility. Windows ME and Windows Vista both made bad first impressions. Though Microsoft released patches to address many of those problems, many people had already decided to avoid them. Fortunately for Microsoft, it's retained some respect with releases that have left a more positive impression, like Windows XP and Windows 7.
Google's position on the Web is solid. According to the analysis firm Efficient Frontier, Google held 75 percent of the search engine advertisement market in first quarter 2010. Gmail, Google's Web-based e-mail shows steady growth, up 27 percent from 2009 to 2010, while the reigning Yahoo Mail is losing ground [source: Saint and Angelova]. In addition to its search engine, Google offers consumers online productivity software, video and photo sharing services and mapping applications. Google has worked its way into the OS market with its mobile platform Android and its Web-based OS project Chromium. However, it doesn't produce many desktop applications that can stand alone without Internet connectivity.
Microsoft has a much stronger hold on the desktop application market. Beside 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. As mentioned earlier, Google introduced its own Chrome browser that jumped to the third-largest market share quickly. The Chrome browser may pave the way for the Web-based Chrome OS to become a viable OS competitor.
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 in many cases.