Microsoft is working hard to catch up with Google. We have to wonder if they will be able to succeed. After all, Microsoft has a terrible track record of throwing money at a problem in an attempt to grab the number 1 or number 2 position. Everyone has witnessed how poorly Microsoft’s efforts paid off when they attempted to bump IBM’s OS2 and Apple’s OS out of the market, not to mention poor showings in forays with Netscape navigator, and Real Player. Microsoft obviously tanked in all those matchups. . . .Well actually they didn’t, they took market leads in all areas. They have been much less successful with web design tools as Frontpage has faired miserably against Dreamweaver, but MS has a solution to that as well with Microsoft Expression, which is even offered Free through the end of the year!
Currently Microsoft is number 3 for ad revenues behind Google and Yahoo!. They would like to catch up in advertising and in search. They are hoping to leverage their presence in mobile phones, gaming systems, and Digital television to help take share by creating a bigger market. Google may hold a lead in web browsing alone, but expand that out to advertising in gaming consoles and Microsoft has an obvious advantage with Xbox 360 (Oh and they are trying to beat Sony and Nintendo in that market too.)
Microsoft is often lauded as being slow to develop and poor at creating great new applications, however they are great at playing catch up! They are also very good at waging a multi-front assault on many different competitors at one time.
Microsoft is rapidly turning itself into the General Electric of Software and Internet technology, building out many very broad and increasingly very deep markets.