Microsoft announced its launch of its first European anti-trust case against Google today. Its a significant indicator for both companies, on a number of points.
With falling PC sales, Android and Apple OS taking over the tablet and phone markets, Microsoft can no longer rely on software products to generate the dollars it needs to have to maintain competitiveness on a large scale. So Microsoft is turning to one of the few areas where it is not precariously positioned atop the leaderboard- the search market. With over a quarter of the US market, and apparently less than 5% of the European search market, Microsoft is clearly not the leader in search. But, it has showed promising gains in the very lucrative search industry and now is throwing its weight in on Google.
I’ve been writing the last few days about how Google is up against Facebook to maintain a cutting edge approach to search with the use of social indicators. Since Facebook data is largely walled off from Google, it has to make significant efforts to cut into the social network business sooner than latter. As we’ve detailed, this presents problems for end users and search advertisers alike. Instead of coming up with innovative products, Google is now tasked with a game of copy cat with Facebook, which limits its users’ ability to experience truly new and intuitive search products. For advertisers, it means our Los Angeles web design clients now have to be present and spending money on SEO with Google, and have to direct portions of their advertising dollars to Facebook as well. This division often limits effectiveness, and as the two get messier and messier, it will only complicate the situation.
Having Bing jump on Google’s back undoubtedly does not help, although I’m sure Google’s extensive legal spend can handle it. But the more and more attention that people see drawn to Google as the big bad, ugly ‘gorilla’ as the New York Times put it, then it will start to erode consumer confidence and popularity. While it may not kill Google (likely Will Not), it can definitely degrade stock values. Just take a peak at Microsoft. Their stability is admirable, but their recent growth makes them a rather poor stock investment compared to other tech firms.
Sadly, this type of press is only going to mean that Google’s product offerings continue to fall apart. You’ll see more blundered launches, more poorly conceived advertising campaigns (I hear Jerry Seinfeld is available), and less actual meat to their products. Why? They have to spend dollars and energy trying to find a way to one up a competitor, out maneuver them in court, and best the competitor at their product, rather then trying to figure out what is the next most natural way for search to evolve.
There was another article over at Business Week that I thought showed more of the symptoms of a struggling, protectionist company, rather then an industry leader and innovator. It talks about Google’s ‘open source’ Android products. And how, maybe, they’re not so much open source. Check it out here.