Is Microsoft Aiming For Google Or Apple?
Microsoft Corporation (NASDAQ:MSFT) is doing extremely well. The company’s stock is at its highest level since the heady days of the dotcom bubble, and analysts seem optimistic about the company’s ability to proceed in a fashion that delivers value to shareholders. The future of the company looks bright for the first time in years, but it’s difficult to tell who the firm’s major competitor is at this point, Apple or Google.
Apple and Google appeal to markets that Microsoft Corporation (NASDAQ:MSFT) does not. At the same time the majority of the firms’ revenue stream are exclusive, albeit related. Microsoft is a software company, Apple is a hardware company, and Google is an advertising company. The three businesses are interlinked, but each firm has concentrated on just one for its revenue. In order to grow Microsoft will probably need to push in on one of the other companies’ turf.
Microsoft Is Coming For Apple
Apple Inc. (NASDAQ:AAPL) subsidizes its software and almost completely forgoes advertising in order to sell its hardware. The company’s software, which includes packages like Final Cut, iWork and Garageband, is free or cheap and the same can be said for its operating system.
Microsoft Corporation (NASDAQ:MSFT) wants a piece of the hardware market. It knows that selling a new operating system is going to be more and more difficult as computers, or in this case tablets and smart phones, get less expensive. Qs with PCs it needs to sell on its operating system when users get new hardware. Apple Inc. (NASDAQ:AAPL) is the company to beat in the hardware sphere, and Apple wants a piece of the company’s market.
Microsoft will concentrate on enterprise in order to get ts hands on device business. The company will link its hardware to enterprise software and services and try to displace Bring-Your-Own-Device programs. That may or may not work, but one thing is clear. Microsoft is definitely gunning for Apple.
Microsoft Doesn’t Care Much About Google
Google makes its money in advertising. The company gives away almost all of its software and services, and it sells hardware at close to no margin. Microsoft Corporation (NASDAQ:MSFT) has been making inroads into advertising for years, but it’s never managed to make a success of the business.
The firm has, however, integrated its Bing search engine into Windows 8.1. It is trying to push adoption of the engine as standard through all of its software. It’s unclear whether Microsoft really cares about advertising, but it certainly isn’t pouring a huge amount of effort into the business. Google service will still likely dominate Microsoft devices, and Google will make billions off of the operating system.
Google Inc (NASDAQ:GOOG) and Microsoft Corporation (NASDAQ:MSFT) have long seemed like enemies, but right now there is little enough competition between them. Advertising revenue is not something that Microsoft is investing a huge amount of money in securing. The real enemy is Apple Inc. (NASDAQ:AAPL) and few resources have been spared in the hunt for hardware.
Disclosure: The author has no position in the stocks mentioned in this article, and does not intend to initiate any position in the next 48 hours.