Can Google or Microsoft get any bigger?

With increased competition and regulatory attention, both Microsoft and Google may find that future growth is hard to come by...

There are still areas of potential growth, of course, not least geographically. Emerging markets interest both firms enormously, and Microsoft in particular has been aggressive in chasing them, producing cut down versions of its Windows operating system for sale in developing territories. That said, rampant piracy still presents a problem there, but there's undoubtedly an untapped revenue stream.

Yet the pair's biggest threat surely remains regulatory attention. Microsoft's loss of its US anti-trust trial all those years ago remains a potent reminder of just how much damage a ruling can potentially go. After all, it was originally decreed that Microsoft should be split into two companies. Yet even though appeals overturned that, it's still faced and, indeed, is facing attention from the EU over its market position.

Microsoft's latest tactic is to drag Google into the mix, too. It looks daft on paper, but may be smart longer term, if it plants Google on the EU's radar.

Microsoft has now argued that if the EU pushes ahead with plans to break the bond between the Windows operating system and Internet Explorer web browser, that it could hand Google increased dominance over the search engine market. Microsoft's argument is that if it was forced to bundle alternative browsers with Windows such as Firefox or Opera that the pair would by default go to Google's homepage. It's a loose argument, but at heart quite a tactical one. Don't expect the EU to buy it, though.

Advertisement - Article continues below
Advertisement - Article continues below

Where next?

So where do the pair go from here? Wherever it is, they go carefully. There's headroom for both to expand further, and Google in particular has options to explore its cloud computing office products, which naturally present a direct competition to Microsoft.

In fact, it's entirely likely that the pair will trade blows in several market sectors in the years ahead, albeit never far away from the eyeballs of a government official in some part of the world.

Shorter term, Microsoft will be looking for a revenue boost from the launch of Windows 7 this year and Office 14 next, while Google is readying Chrome 2, continuing to develop Android and squeezing every penny out of its search business that it can.

Its revenues still account for around a third of Microsoft's, so for the time being at least, it's not likely to be bothered to the extent of its rival. But the honeymoon period has long gone, and both firms can expect even more testing times ahead...

Featured Resources

The IT Pro guide to Windows 10 migration

Everything you need to know for a successful transition

Download now

Managing security risk and compliance in a challenging landscape

How key technology partners grow with your organisation

Download now

Software-defined storage for dummies

Control storage costs, eliminate storage bottlenecks and solve storage management challenges

Download now

6 best practices for escaping ransomware

A complete guide to tackling ransomware attacks

Download now

Most Popular

Microsoft Windows

This exploit could give users free Windows 7 updates beyond 2020

9 Dec 2019
Business strategy

Ex-Apple CPU architect accuses the firm of invading privacy

10 Dec 2019

Patch issued for critical Windows bug

11 Dec 2019
Microsoft Azure

Microsoft, not Amazon, is going to win the cloud wars

30 Nov 2019