Where Microsoft lost its way - Google obsession

Microsoft has always been a software company and Google has always been an online services firm. Historically speaking, Google has never sold an operating system (or anything else for that matter) and Bill Gates and company have yet to embrace any online service that won't allow it to turn a profit.

Knowing that, why are Microsoft and Google such fierce competitors? Surely, the latter would have been content controlling the online space without competing against the former, but why did Microsoft decide to pick a fight with one of the most powerful online firms in the world?

Believe it or not, the answer is actually quite simple - jealousy.

And it's that jealousy that has not only forced Microsoft into a corner, it has led the company to believe it can be a bloated mess and offer a wide array of products without focusing on its core competency - software.

Microsoft's Google obsession started when Sergey Brin and Larry Page did something no other company could do - grow in the face of Bill Gates to a level that not even his company's $2 billion profit per quarter could stand up to. After all, if Microsoft held on to anything over the past decade, it certainly latched on to the belief that because it was the most powerful company in the technology industry, it could do practically anything it wanted. But all that has changed.

Because of Google's meteoric rise and its staggering profitability, it has become one of the most powerful companies in the world and one of the few that can stand up to Microsoft. To make matters worse, it's the good guy to most people and its services don't aim to gouge your wallet even though they work extremely well. Instead, Google has embraced a new philosophy -- "Don't be evil" -- and so far, it has done a pretty good job of sticking to it. For the first time in recent memory, Microsoft is the company without the advantage and realizing this, it has lost its focus on software and ensuring Office and Windows are up-to-par. Instead, the company's focus has moved towards the online space and it's doing all it can to supplant Google as the de facto leader.

In just the past year, Microsoft acquired aQuantive, a relatively unknown advertising company after Google acquired Doubleclick; it bought into Facebook and acquired advertising rights after Google went after MySpace's advertising and has tried to downplay the significance of Google.

"Google is not ahead of us," Microsoft CEO Steve Ballmer told reporters in Tokyo last year. "In the area of search specifically, Google would lead."

Really, Steve? As far as I can tell, Microsoft is behind in advertising, online applications, productivity tools, Webmaster tools and many more. To make matters worse, the company is behind in the realm of software now too. But if it weren't for Google, I doubt all that would be true.

Let's face it -- Vista is a downright dog. With a slew of issues, including slow load times, bloated code and a User Access Control that forces you into click fatigue, it looks more like a beta release than a final build. To make matters worse, the company decided to pursue its ill-fated "Vista Capable" campaign and seems to have lost its sense of what's best for the consumer.

Is Mac OS X a perfect operating system? Of course not. But when compared to Vista, I don't think anyone can say that Windows is better than Apple's offering. Knowing this, why hasn't Microsoft gone out of its way to stem Apple's advance and improve Vista as soon as possible? Does it actually believe SP1 is the only piece of the pie that's missing? If not, why hasn't the company done more in the software realm?

In a word -- Google.

In one fell swoop, Google came along and utterly destroyed the foundation of Microsoft's control over the tech industry. And in so doing, Microsoft lost its focus and abandoned its core business to stop Google's march to the top of the online mountain. But what the company never realized and still doesn't is its bifurcated focus is dangerous and could ultimately lead to its downfall.

It's time to play nice with Google, Microsoft. Or else.