Google vs Microsoft, who will win?

High-tech companies are very exciting. Just like watching a game of baseball, where not much could happen for 7 innings, and then all of a sudden, a bad pitch, a good hit, and a stroke of luck could change the game immediately. Even big companies that's been winning game after game, could suddenly be toppled because of something as small as an obnoxious fan trying to catch a ball. IBM, Microsoft, Apple, Sony, Intel, AMD, Sun, all big name companies at one time or another, all went through phases of drastic change even within the few decades of operation. No company is immune, and they all need to stay vigilant to changes in the fickle market. And now two of the biggest tech companies have up'd the ante, and you better be at the edge of your seats because a homerun could change the game at any time. How does Windows 7 change things? Here's how it could play out:

How Microsoft could kill Google: 
Bing Bling
Google does a lot of things, email, maps, web hosting, documents, but they really only make money from two things -- adwords and adsense, both of which are tied to their search engine. The billions of dollars they are paying their engineers to have fun and develop cool web apps come from the bidding of keywords that is displayed on the search results page. If Google lose the search engine market or even just a chunk of it, they would suddenly have too many engineers with not enough money to support them. If this were to happen, say goodbye to all the Google benefits, people would start losing their jobs, and the culture would have to be drastically changed to defend their core business. The company would not be able to sustain the heavy investments they have in R&D, and would have to resort to being like Microsoft, where they would only enter a market after someone else have proven its worth. Microsoft can then deal the final blow because, you know, Microsoft is better at being Microsoft than Google is.

So, how would they pull it off?
To put it simply, create a beachhead. Some may hear that Bing search offers pretty good search results, but still not use it. Why change to bing when Google works great?

What they need to do is to give a reason to start using Bing. It doesn't have to give better results for everything, or try to replace Google immediately, but it needs to have a "wow, this is awesome" feature to use Bing for. If Microsoft developed Google Scholar, Google Images, or Google News before Google did, they would have a very strong starting point. From there, after users get used to typing in www.bing.com to do those specific searches, users would seriously consider replacing Google since they both solve the need for search. What they need is a means of attracting a core audience, and then find ways of spreading that audience to use their service for all other purposes. Specific and useful searches, but simple and easy to switch to their main service.

Will it happen?
Microsoft picked real-time search for their first beachhead. It certainly has potential to be big. However, I don't know about you, but I'm still confused about the whole twitter and update things in facebook. I'm not sure what circumstances I would need to be in for me to think in my head, "hmmm, what should I use to help me solve this problem? Oh, I know, real-time search with Bing!" But I would keep an eye out for any developments along this front.

I personally wouldn't have signed both Twitter and Facebook at the same time, since they are pretty fierce competitors. Rather, I'd probably try to sign an exclusive deal with Twitter, just because Facebook doesn't seem to like Google a lot. Still, though, props to the big MS for seeing this market and getting the deals through.

So... maybe. It could happen. It depends on whether people are right about the importance of web 2.0 for search and how Google will respond to this threat.

side note: 

How about make a 2d search result page, that offer the top results from each type of search, and the user can move through the results depending on which direction seems to match what the user is looking for the most? You can even eliminate the pagination delay with Ajax and make it like cool like iPhone.

How Google could kill Microsoft: 
Cloud OS Online Office
Microsoft, even though they have significantly diversified, their core business and most of their innovation still comes from their operating system, Windows. Without it, their relationship with computer manufacturers couldn't be leveraged, and their dominance would fade when they don't have enough money to throw at new markets to compete with the leaders there.

So, how would they pull it off?
Well, Google is one of only a few companies in the world that can pull off the creation of a real cloud operating system, as I described here. But honestly, that's still a few years away from coming to market.

An alternative is to make operating systems a sort of commodity, making people care for operating systems as much as they care about the type of tissue they have in the bathroom. Once that happens, it would no longer make sense to pay $200 for an operating system when you can get one for free, or another one that gives you a personality.

What do you think of when you're thinking about changing operating systems? Usually, two things -- programs and files. Right now, there are a bunch of web tools that can do what have been traditionally done only on the computer. But out of all of those, the most important ones are the productive tools that you use to make the presentations to the boss. He doesn't care which program you use or which operating system you have, just that you get it done. If you can just upload your presentation to Google docs in an easy manner (like dropbox), and be able to make it show up when you're ready to present, it wouldn't matter that you made the slides on your Linux box, and you're presenting it on a computer in the conference room with a mac.

Will it happen?
No. As much as I like Google, and as much as I don't like Microsoft, I really don't they are positioned well enough to take on Microsoft. Honestly, it feels like they've given up on Google docs. They haven't updated it in ages. For the longest time, I tried to like it, but it's a lost cause. Now that more and more people are creating pptx files that Google docs can't naturally convert, they've lost the window of opportunity.

Google creates a lot of mediocre products, sprinkled with neat-o features, but that is really not going to make a dent in the Microsoft kingdom. Luckily for Google, Microsoft also has to worry about Apple. They just might distract Microsoft enough that Google comes out with something that makes even more money than search. yaa.. I won't count on it though.

Conclusion
To me, it seems like Microsoft is playing it very smart in an Armani-suit-businessy-way, whereas Google is just playing around with promising platforms and cool applications without a focused strategy. They would seriously be in a bad position if they suddenly find Microsoft with a significant portion of search and their newest gizmo's like Android, Wave, and App Engine turn out not to be the money-makers they expected. Microsoft have played defense and offense pretty well, and they are poised to keep their position as the top player. Let's hope the Google engineers have been using their 20 percent time well.

And no, Facebook won't be able to replace either of them.