Google goes head-to-head with Microsoft

In its bid to expand, Google appears to have no choice but to take on Microsoft, says an industry observer. Will it be able to succeed where so many others have failed?

perspective Google is the latest company to be seen as a possible block on Microsoft's road to world domination.

With possible moves to link with both the wounded AOL and the up-and-coming Opera browser firm, 2006 will be a critical time for Google's ambitions.

Dealing with Microsoft is a major challenge for other large IT companies. While variations have been attempted, the choice inevitably boils down to working with Microsoft or working against it. Neither route is appealing.

Working with Microsoft has been fraught with difficulty. One of the most alarming examples is PC building. From a commercial angle, the PC breaks down into three parts--the processor, the operating system and the remaining bits and pieces. Intel makes money with its near monopoly on chips, component makers have to struggle for profits and the major PC builders get such meagre crumbs that most of them have seriously considered quitting the market at least once.

So one way to collaborate with Microsoft is to first ensure control of an important market sector, such as processors. The other has been to work in one of the few areas Microsoft has little strength. IBM is the arch exponent of this approach, having generated huge revenues on providing services to deploy Microsoft technology with enterprise customers.

The alternative is to tackle Microsoft head on. So far, all the companies attempting that have emerged bruised if not dead. Major examples include Novell and Sun, both of whom were forced to withdraw from confrontation to a position of grudging co-operation.

An unfortunate outcome of all this could be a new rush of change in the browser sector..

Google will be an interesting case. It looks to have little option but to challenge Microsoft, which has already demonstrated its intention to take Google's market away from it. In Google's favour are its very strong grip on the search market, its established advertising network and its pile of cash. Maybe even more important is Google's high rating in public perceptions.

Getting the maximum leverage out of its cash is a critical issue for Google. Rumours that it may buy Opera make sense. Microsoft's hold on the browser market has recently weakened. Although it still holds the lion's share of the market, among people who make an actual decision to use a particular browser, its popularity has plummeted. Opera has long had a loyal following, and Firefox has been making steady inroads. Opera in particular is also a route into the fast growing mobile services sector.

Which way AOL will jump remains to be seen. At the peak of its strength, it pulled back from the challenge to Microsoft that would have been possible using its newly purchased Netscape assets. Now seen as a liability to the Time Warner business, AOL is anxious to hang on to its position as a content provider. And Google's cash would not go amiss.

An unfortunate outcome of all this could be a new rush of change in the browser sector. At present, web development is heavily biased towards standards compliance. Many developers now run their sites against the W3C validation tests and go to considerable trouble to be fully compliant. Use of XHTML is near universal.

This trend has been one of the key factors in the growth of Firefox, seen to be the most standards compliant of the major web browsers. New competitive activity might well spur technical innovation but is liable to sacrifice standards with losses in productivity and accessibility.

It is doubtful whether more than gradual technical innovation in browsers is really desirable. Within the existing standards, there is huge scope for building innovative sites at the level of the user experience. The most uncertain area of development is the attempt to move more functionality away from the server through approaches such as Ajax and XUL. Success for these developments is significantly hampered by lack of standards adherence.

With Google taking an interest in some of these key technologies, the outcomes become less predictable. Whatever the detailed outcome, it seems certain that Google will be in the headlines in 2006. And Microsoft is rarely out of them.

Martin Brampton is founder of Black Sheep Research, an independent consultancy providing research, writing and speaking services on a wide range of business and technology issues. Martin was previously a director at Bloor Research, and has worked with IT as a user and analyst for over 20 years. He is a long-term contributor to Silicon.com through his weekly column, Devil's Advocate, which tackles a wide range of issues. He can be contacted through his Web site.

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