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Will Google Become the Next Microsoft?



It would be easy for me to jump on the bandwagon, that’s going to gain momentum today, from Microsoft CEO Steve Ballmer’s recent comments on Google.

“They are trying to double in a year,” Ballmer told a crowd of Stanford Graduate School of Business students on Thursday. “That’s insane in my opinion.”

Focusing on that comment would be like shooting fish in a barrel. More interesting are Ballmer’s back-handed compliments that appear to send a message to the media (and investors) that Microsoft was once like Google, and that the world’s largest search engine may too become like the Redmond software company.

“They do a lot of cute things,” Ballmer said, to huge laughs from the business students. “We do a lot of cute things too,” he said. “We have a robotics effort.”

And..

“Google is in the part of the cycle where they are milking,” Ballmer said, acknowledging that’s a fun stage. “That was the 1990s for us… or I would say the 1980s and 1990s.”

And what he’s probably thinking…

“We were loved back in the early ’80s, everyone thought we were cool too, remember? You just wait until Google reaches our size and starts monopolizing industries. All of us at Microsoft are waiting for that day, so we can welcome them to the club.”

:-)

  • http://www.wpromote.com/blog/ Mike Mothner

    This really brought a smile to me face because it is SO very true…

    Google has been the public and the media’s darling through this point. However, they are reaching a size and market share that makes it almost unavoidable to be the next goliath in their industry, much like Microsoft is in the OS and desktop apps market.

  • http://www.BrianChappell.com Brian Chappell

    I don’t think you really can compare the two like that Mike. Google goes out of its way to give great services away, for free. For example: http://pages.google.com
    http://www.google.com/calendar
    picasaweb.google.com (wow, just noticed they up’ed the storage to 1g now from 250mb, absolutely free)

    Microsoft would monetize anything they could get there hands on. My 2 cents.

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  • http://www.wpromote.com/blog/ Mike Mothner

    Brian, Google sure does give their products out for free, but I believe that you are misreading a radically different business model as altruism.

    They make and give away terrific products to win users and eyeballs, which they then monetize (extremely effectively I might ad) with highly targeted advertising.

    To the users of these products Google doesn’t look like Microsoft at all. However, to the advertisers like our clients spending millions of dollars a year to reach these eyeballs, Google looks a lot more like Microsoft than one might think. With almost half of the world’s search engine queries going through them, you have no choice but to use advertise with Google to reach their users. This gives them incredibly monopolistic ability.

  • http://www.everydayweekender.com Everyday Weekender

    Yeah I have to agree with Mike. It’s a really big debate for sure. It will be interesting to see the comments on this post – as people always get heated when talking about MS or google, or any other monster of a company for that matter.

    Google and MS both provide services.. some are cheap and some aren’t.. but at the end of the day, they both have the ability to control their markets.

  • http://healthcareinformationsystemsblog.blogspot.com/ Jeff O’Connor

    Why is that when Google gives away software like Picasa and Google Earth they’re hailed as heroes, but when Microsoft gives away similar fare – bundled with an operating system that’s largely invisible in terms of price to end users – they’re demonized?

    I remember when Netscape.net *was* the Internet (unless you were an AOL subscriber), and I remember watching Netscape sit by and do nothing to capitalize on that fact. But they sure knew how to scare the beejeezus out of non-academics into paying for the privilege of surfing the Web with their browser.

    Then came IE, for free, and laid the foundation of the current Web. Seriously. I challenge anyone to compare Netscape Navigator 4.0 to IE 4.0 and honestly say that 1) Netscape was the better product, and 2) IE didn’t lay the foundation for AJAX, RSS, and many of the other slick “Web 2.0″ technologies that Google gets so much undeserved credit for.

    And the list goes on and on – WinAmp, Eudora, and other programs for just about every software niche that’s out there; the bulk of which Microsoft’s detractors probably weren’t even aware of until Redmond gave away their own equivalent product, bundled in the Windows OS.

    I’m not naive – Microsoft has crossed the line into seriously unethical behavior on more than one occasion to *maintain* its market dominance, but the way they got to the top of their respective market strongholds is almost identical to the way that Google has taken: build a better mouse trap and “give it away.” Microsoft did it with their ubiquitous OS, and Google does it through their ubiquitous search product. If this makes Microsoft the “evil empire,” shouldn’t we all be hating Google just a little bit, too?

  • http://www.wpromote.com/blog/ Mike Mothner

    I think there are a couple of answers to Jeff’s question of why we don’t call Google the evil empire when they have a similar choke hold on their industry.

    The first is that to many people, Google really IS seen that way. In the search marketing industry it truly is a love/hate relationship. We ultimately love their system, their users and they really have gone about search marketing in a brilliant way. But just try to explain that to marketers slapped with the quality score initiative rolled out in recent months. To them Google giveth and taketh away, and there isn’t a darn thing they can do about it.

    The second answer is that as Brian’s comment illustrated, to the vast majority of Internet users, there is no hint of an “evil empire” mentality. Everyone is given truly great services like the search engine, Gmail, Picasa, GooTube, Google Maps and Earth. I mean shoot, I would bet that a major portion of Internet users could not explain how Google made their $10 billion of revenue last year. So to these people, to the vast majority, Google I feel really does appear to be a big, friendly company churning out tons of free, great products. The “evil empire” if you will — the power that Google truly does wield over worldwide commerce — is quite a bit less in-your-face than Microsoft.

  • http://www.BrianChappell.com Brian Chappell

    I have been using Google since day one it came out so I am surely not the typical user, as you compared me to, Mike. What I can tell you in my personal exp with Google is that I appreciated its attempt to make search simple. Its speed, and best of all the relevant results it returned.

    They dominate the landscape not b/c they MAKE you use there system, I think this is the key difference here. Microsoft has pre packaged its software suite on PC’s for a very long time, and has charged out the ass for it.

    If there was no other competitor in the game then I might see the validity in your post, but this is not the case. It is not Google’s fault that the other guys cannot compete. Google does not keep them down either.

    Micro$oft could have given some of its software away for free, and been more Google-esk in my opinion instead of charging hundreds of dollars for every single piece of software they have developed over the years.

  • http://searchenginetigers.com Simon Heseltine

    All this talk aside, isn’t it going to be moot when Microsoft dominates search in 6 months? Of course they’ve been repeating that statement every 6 months for the last 2 years or so…

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  • http://www.freedomware.us/ David Blomstrom

    I certainly hope Google never becomes as corrupt and dysfunctional as Microsoft. Fortunately, I don’t think we need to worry too much, because Google’s founders lack something Bill Gates has: a corrupt corporate attorney for a father. That’s the real secret to Microsoft’s success – intimidation, dirty tricks and politics, not innovation or fair competition.

    In other news, have you noticed that George W. Bush and his pal Bill Gates both appear to be coming unhinged, with Steve Ballmer now joining the party? What do you suppose these creeps are all afraid of?

  • http://www.everydayweekender.com Everyday Weekender

    Simon, I started reading your comment, and at first I was like, what is this guy talking about.. then as i finished reading.. you made me laugh.. because i was thinking the same thing ;-)

  • http://www.wpromote.com/blog/ Mike Mothner

    Brian, I feel like there are a couple of items screaming for clarification here, because you are making good points, but they really are off the topic.

    First, I did not claim that you were an amateur web user. That you are an expert user I do not doubt. My point was that the *users* of Google do not see any sort of “evil empire” aspect at all. It is from the advertiser perspective that I am making these comments, and you obviously are responding from the user perspective.

    Google does not force users to use their services. Rather, I 100% agree that they make such good services that people choose to use them. Once again, from the advertiser perspective — from the parties that made Google their $10 billion of revenue last year — they really do *not* have a choice. Regardless of what we think about Google from a user perspective, we truly are *forced* to advertise with them in order to reach their audience. Nobody is going to run a successful online marketing campaign without tapping into Google’s monstrous market share.

    Finally, I am *not* suggesting that Google is evil, dysfunctional, or exercising it’s monopolistic muscle at this point. We love dealing with them and have extensive relationships with the folks at Google, and I hope that this never changes. However, as time goes on, and as their monopoly over the search market grows as I believe that it will, it will be harder and harder to resist the temptation to squeeze more money from their advertisers (again: advertisers, NOT users, they have a different business model from Microsoft) in order to continue on the torrid revenue growth trajectory that they are on and provide the best possible return from their shareholders.

    Mike

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  • http://www.pckleen.ca/ PCKLEEN

    It’s very likely Google has surpassed MS in every way. Big difference is, Google’s products work whereas, with MS, they’re still trying to make it work.

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  • http://www.wpromote.com/blog/ Mike Mothner

    This is a late follow-up to this post, but I found it incredibly supportive of the claim that Microsoft and Google share some very similar traits:

    http://www.businessweek.com/magazine/content/07_15/b4029001.htm

    Specifically:

    “” If this talk of corporate dominance sounds vaguely familiar, it should. As firmly as IBM (IBM ) ruled mainframe computing and Microsoft the personal computer age, so Google has the potential to rule the Internet. To some people, Google’s position today, while clearly far from identical to Microsoft’s in its heyday, nonetheless shares some striking parallels. “Google feels a lot like Microsoft in the mid-Nineties,” says Silicon Valley startup adviser Dave McClure. “Right at the height of its power, getting a little arrogant, and challenged for the first time by some powerful people.”

    Mike

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