Google vs. Microsoft: Who is going to win? That’s the easiest question of the year because the answer is simple. Both of them. You see it all depends on what you are expecting them to win at. There are really two battles going on: the advertising battle, which involves the two titans and the muscle of Moonves (CBS), Murdoch (News Corp.), Zucker (NBC) and Iger (Disney); and the applications and enterprise software battle, which brings in Oracle, Apple, Sun, Adobe and the rest.
Today, Microsoft (nasdaq: MSFT – news – people ) has less than 10% of its total revenue arising from advertising. Google (nasdaq: GOOG – news – people ) sits at around 100%. Microsoft needs to lose heavily on Office, Windows, servers and enterprise solutions and gaming before the castle of Redmond starts to shake at the foundation. Will Google win at search? Yes. Will Google beat Microsoft at the display and ad platform game? Maybe–but Google will find it incredibly hard to achieve the position of dominance on that side of the house.
In Microsoft’s heartland, Google will have no easy ride. The attraction of cloud-based applications software is clear (it’s free) without being compelling. Are the Google Docs applications as fully featured as Microsoft Word and Excel? Are the collaboration tools more effective in Google Apps or Microsoft’s SharePoint? Businesses will vote for Sharepoint. That’s the Microsoft heartland. Businesses seem happy to pay for rich tools–and may even be suspicious of the idea that a copy of every document they create sits in a cloud owned and operated by Google.
Even consumers, Google’s biggest fans, might be concerned, with or without reason, with the notion that a single enterprise could hold and theoretically co-mingle the data from their household budget, medical history, job applications, search queries and Web browsing. In that case, they would be right to hope that “do no evil” is a legal obligation rather than merely a corporate statement.
As for Yahoo! (nasdaq: YHOO – news – people ) and who carries off the spoils: The Department of Justice and the Federal Trade Commission will likely decide that. Maybe the prospect of either MSFT or GOOG adding the ! to their ticker will fail to please.
Rob Norman is director of interaction at Group M Worldwide, the media investment management arm of WPP Group. His blog is “On Demand.”