Killing Microsoft
There is an old Japanese proverb that says, “If you sit by the river long enough, you will see the body of your enemy float by.”
Don’t expect Microsoft to exhibit that kind of patience, now that Google has issued a direct challenge to the MS supremecy in PC operating systems. Vowing to offer a new system based on its Chrome web browser, Google unabashedly says it is going to war with the intention of killing Microsoft.
I wish them luck.
It isn’t just that we’ve seen this before (McIntosh, WordPerfect, Unix, Ubuntu, etc.). There’s also the question of what motivates the two companies to excel. Microsoft wants to sell products to people that will bring them back to buy more products. Google appears to want to sell products that allow them to track and extract data from people that they can sell to their advertising partners.
And while I’m not always a fan of what the guys in Redmond do, I also have to note that they’ve been at this game a lot longer than Google has. They may be older, but they are therefore wiser and more skilled at the marketing in-fightin needed to win such a war. And while both companies are well capitalized, Microsoft is moving boldly in three areas that should have Google concerned:
- Bing. Right now, Google is still primarily a search engine. Its revenue derives from advertising, which in turn is greatly tied to advertising from that engine. So when Microsoft announced its new search engine called Bing, it largely began the war with Google. Remember, Microsoft often enters markets it cannot win — if for no other reason to bleed competitors enough to keep them away from Microsoft’s core businesses. That happened with Corel, and could be happening again with Bing, which to all appearances is an upgrade to the venerable search engine.
- System 7. Sure, Vista was not the operating system everyone wanted. But it did push the envelope in a number of areas, and gave Microsoft experience it needed to build the next generation of operating system. Google has none of that experience, and will be launching their product after the debut of what appears to be a very capable new System 7.
- Microsoft Security Essentials. This free security solution for PCs will debut in the fall at no cost. While this may at first seem an assault on Symantec and Trend Micro, it is more likely an effort to build more value into the operating system while avoiding the kind of regulatory scrutiny Microsoft suffered because of its Media Player. Take it outside the operating system, offer it for free, make it integrate tightly with System 7, and you have another major piece Google can’t compete against.
The bottom line is this: Google didn’t declare war on Microsoft, but vice versa. The launch of Bing was an act of war that Google could not overlook. It remains to be seen whether it is a war that Google can win.
Personally, I have my doubts. Like America Online before it, Google is making three major blunders in its efforts to dominate the world. First, it is moving too fast in too many directions. Books, art libraries, geo-mapping, web browsers, email and more — Google can’t seem to decide what business it wants to be in.
Second, Microsoft has spent 25 years building relationships with other players in the industry. Google, a relative newcomer, seems more inclined to try to buy its friends — and alienate other key players by insulting or assaulting them. They may be going to ware without allies, which is dangers and foolhardy.
Finally, it is attempting to overcome marketing deficiencies with political sleight-of-hand. Sure, Google has great ties to the Obama Administration. But its reputation in Congress and with the FCC have been badly damaged by its efforts to “game” the spectrum auctions for wireless and by the Network Neutrality debate (which Google initiated and then abruptly abandoned).
No matter how this turns out, it will make for an interesting winter in the tech world. I plan to settle in to a comfortable chair with a botle of good Cabernet and some popcorn to watch the show.
Great post, Dave, but I’ve got to put in my dime’s worth…
I think Google does, in fact, know what business they are in- I just think that most of us “consumers” don’t know what business they are in.
You actually hit it on the nose earlier in the post when you noted that Google “appears to want to sell products that allow them to track and extract data from people that they can sell to their advertising partners.”
That is exactly what their business model has become: advertising and data mining/sales. And while I’ve always been a little leery of Microsoft, I think I will still prefer to use their operating system over one from Google that is free, which means that it is built on a plan of Google extracting data and selling it to advertisers. Google isn’t developing the hosted OS as a model for the public good… if it is “free” to users, there must be a back end to it that allows for a profit realization.
When it comes to something as critical as an operating system, I would much rather use something that I pay for with money rather than with my personal information. That said, cloud-based systems are most definitely going to be the future- hosted everything- but that doesn’t mean we have to relinquish the privacy of our personal data.
I fully agree with your point on the aimless behavior Google has been portraying with respect to it’s product line. Objectively speaking, I do not believe Google offers much in the way of product quality.Every product they send to market seemingly violates the privacy of you, me, or some fifty million people in Britain.
Ultimately it is this arrogance that will eventually prove to be it’s downfall. People will not stand for their privacy and annonymity to be the price for an operating system or any other product.
In the end, let us not forget all of the knowledge that Microsoft has acquired, and all of the positive partner relationships it has built over the years. While Google is off preparing for the launch of its first operating system (a full 7 editions behind Microsoft, and 10 or so behind Apple) Microsoft will have ample opportunity to seemlessly create a cloud-computing environment based upon the largely superior Office 12 platform.
Google needs to take a healthy dose of “you can’t be everything to everyone all of the time” before it engages a company the owns virtually 100% of the business market. And, oh yeah, none of this takes into account the war Apple will puruse against Google the moment Apple feels threatened.
Goodluck Google, you seem to be building your own coffin.
The difference between Google and MS is that MS’s hands are now tied by three realities:
1. Their attorney’s won’t sanction (cannot) such a battle. They’re NOT the same company from the 80’s and 90’s that threatened IBM and eliminated WordPerfect, Lotus and Borland, from the market–and could get away with doing it. They literally divided their company into two complete entities in preparation for the DoJ rulings. The aftermath of that is that their marketing machine and prowess no longer exists; it hasn’t been required.
2. They may be a lot older, but the old guard aren’t the battle hardened group they once were. They’re soft from sitting on their market share and living riotously with the spoils of their 90’s war victories. They’re NOT a young, aggressive, freshly-freed-from-IBM’s thumb, organizastion who is gunning to take over a market. On the contraray, they’re trying to preserve a market. They’re a lot like an imperialist force who now has many subjects who hate them and see that what really happened when they eliminated their competition is that they eliminated innovation and useful upgrades in their products. And the remaining list of products they ship are lackluster and prone to problems (Xbox is just one example). Other similar companies are CocaCola, Budweiser, etc.
3. They don’t have the same “fire-in-the-belly” personnel today that they had then. It’s really a different era without Bill’s hand on the rudder and sail.
But, they do have lots of money and are willing to protect their turf.