I find the ongoing battle between Google and Microsoft to be very educational (and honestly, very entertaining). It is obvious that the companies are becoming more and more alike. They have similar strengths and weaknesses which tend to surface in different contexts and are now beginning to overlap each other.

Both companies are monopolistic and earn incredible amounts of money by using their respective powerful positions. Both share the same problem (a problem I’d sure like to have :-)), which is, trying to find new markets able to guarantee a continuous increase in sales and revenue.

On one hand, we have Microsoft with its operating systems and office applications, and on the other, we have Google with its search engine. Both companies have reached such a high level of market penetration that they can only, inevitably, go down from here (actually, this consideration is especially aimed at Microsoft, but it might just be a matter of time before the same thing happens to Google).

Both Microsoft and Google continuously strive to add new functions to their cash cows, unfortunately the end results of these efforts are not very significant. Just look at the negativity surrounding Vista (many users continue to prefer Windows XP, even if it is eight years old) and what about Google - there haven’t been any real innovations in searches for years (in fact, it seems that Google’s functions are getting worse by the day). It is also difficult to convince people to switch over to the new version of Office, even if it is better than its predecessor; 95% of users claim that it doesn’t really provide anything new or more efficient. I think this a perfect example of how, in many sectors of software development, we have arrived at a sort of plateau: the returns on investment for new and improved products are always less and we are getting to the point that it is becoming very difficult to justify such investments.

It must also be said that software houses are also “doomed” to keep releasing new versions, because unlike other products, software doesn’t break, isn’t prone to wear and tear and isn’t influenced by the latest fashions. The problem with new releases is that they often require a lot of time and resources, however, they don’t give significant improvements in return.

The prospects for key products like Word or PowerPoint are slim, and Google isn’t doing any better. The fact that Google is releasing immature programs like “Google Squared” and programs for a very limited user base like “Google Timeline”, shows that if no real changes occur on the scene, there will be no space left for innovations which are actually efficient.
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Thus, Google has been trying to gain market share in Microsoft’s territory with its efforts to make applications such as Office useable online and by combining the browser with the Google Chrome operating system. Likewise, major investments by Ballmer and associates are aimed at taking away the market share from Google’s search engine (with Bing, its predecessors and its future successors).

Even the efforts not directly aimed at the enemy haven’t been very successful: for example, Google, which up until  2-3 years ago seemed an invincible juggernaut, has recently produced more failures (Google Base, Knol, Video and Google Print Ads) than winners.

Having said this, I realize that these software giants are constantly under pressure by the international financial community to keep growing, and deciding what to do is not an easy task.
If they reduce the investments in their operating fields, they are accused of not taking the future into account and therefore risk being wiped out in the short term; if instead, they decide to diversify, they are accused of a lack of focus on the core business and of putting their otherwise guaranteed sales and profits on the line…

Just like in politics, it seems that there is no valid third option…I believe however, that a third option does exist and that it would be very simple and beneficial for the rest of the market. Microsoft and Google should lower their prices (Google is free for the common user, but the companies that advertise on Google’s network, pay staggering amounts of money). This way, resources would be free for all other market players, which could then invest efficiently and produce valuable innovations, even in other sectors. For the ecosystem which gravitates around these two giants, it would make more sense to free up the money that currently goes towards dead-end investments in order to get out of this vicious cycle which halts innovation and market growth.

If Microsoft and Google are not willing to take this step, there is another, extremely simple alternative: they could distribute la majority of their profits to their shareholders, the real owners of the companies.

I’ve been channel-surfing during these hot, summer evenings, trying to find something other than re-runs to watch. I noticed that Sky (Sky Italia) is broadcasting a new IBM commercial which, in some ways, addresses the things we’ve been working on for years. I was not unhappy about this because it is always a good thing when a market leader addresses topics which, just a few years back, were not well-known and makes them public for all to see.

The truth is, that for most people, “the management of non-structured data” is a behind-the-scenes activity of the “IT show”. But for those of us who work with these things, the fact that these messages are now being broadcasted helps us give our potential clients a recognizable context.

Clearly, one of the implicit goals of the commercial is to try and convince the public that only a giant like IBM can efficiently and effectively handle great quantities of information (of course, I do not think this is in any way true, so to each his own opinion :-).  What  is important, though, is the value attributed to the problem of data management (and consequently, the technology for solving this problem). Therefore, I truly hope that these kinds of commercials will also be broadcasted on other networks and not just on Sky (then, maybe for once, I won’t complain about the constant commercial interruptions :-).

I’ve written an article which explores what is happening in the Web, and Alt Search Engines published it early this week.

A few weeks ago, Microsoft released “Bing”, a new Internet search engine whose official launch was preceded by low-key marketing (even Microsoft learned a valuable lesson from Google: a quiet release at first, then after a few months of adjustments, a hardcore ad campaign).  Let’s avoid making any comments about the name (I think they could have chosen something better) and focus on what has been promised. According to what has been written, this is supposed to be an Internet search engine which functions on new approaches and new algorithms.

I began to try out the new and improved features, but after two minutes I had to stop: in order to try out Bing’s  new characteristics, you must first select the United States as your country of origin (searching in “search all” mode isn’t enough to extend the query to the entire Web).Therefore, you must know English and of course, your searches must be related to the American world (if these first few months are positive, I’m sure Microsoft will progressively expand these services to other languages and other markets). Anyway, once I resolved the language and country problem, I was able to run a few tests and I believe that it is best to put my judgments on hold: there are some interesting elements but the system needs to be put to the test by users for a few months, so that Microsoft can work out some the bugs.

One thing I can say is that I do not see any semantic or revolutionary functions. Concentrating on set contexts such as: shopping, travel, health and local commerce makes sense and can guarantee better results, but overall, it seems like it is just an evolution of what has already been established in the past.

It must also be said that for the first time, it appears that the arrival of Bing has stirred things up for Google (and this is good) but we’ll have to wait and see over the next few months if it is able to produce long-lasting and concrete effects.