There has always been a lot of posturing going on in the world of tech companies. Apple and Microsoft used to be locked in the ultimate competition. Fueled by separate philosophies and battling fans, the two companies fought for many years for control of the PC market. Today, they compete much less directly, and Apple has turned to gadgets to fuel its success as the number one stock in the world.
Over the last decade or so, Google has been growing and growing each year. Google is a serious competitor to Microsoft and Apple, and is once again in the news for its success. We learned last night that Google’s market value surpassed that of Microsoft’s.
Microsoft relegated to third place in tech.
Last night, news outlets began running a variety of stories about Google surpassing Microsoft in market value for the first time. Nick Wingfield of the NY Times wrote, “For Microsoft, it was bad enough when Apple’s stock market value surpassed its own in 2010. Now Google, a company that didn’t even exist 15 years ago, just did the same thing.” Of course, the two could be flip-flopping for second place in value in the tech world depending on how the market goes, but this looks to be a very symbolic event. In fact, Apple and Google are now the first and third most valuable U.S. companies respectively.
The importance of second place.
Apple has held top market value for about two years now. What drives that? Well, a lot of factors are at play, but one of the important reasons behind it is what Apple sells: iPhones, iPads, iPods, and one heck of a brand experience. But what do all these gadgets have in common? What drives their success? They are mobile gateways to the web. The importance of the internet has grown so much it has permitted these gadgets to succeed.
For Google to pass Microsoft in value makes sense. Marcus Wohlsen at Wired writes that “a grizzled old alpha ape has finally been shoved off the second-highest branch on the tree.” It’s funny, but true. The public and investors perceive Google to be embracing the future. In fact, it is the future. Google’s stake in the success and development of the internet is likely the most significant of any company on earth.
Microsoft looks to be clinging to the old ways and trying haphazardly to adapt to an increasingly mobile and internet/cloud-based computing. Microsoft is old-fashioned; they sell software, and they make money. Meanwhile, Google has multiple revenue streams and doesn’t even rely on Android (which runs a comfortable majority of smart phones) to earn money. Marcus Wohlsen notes that “Android keeps users tied to Google sites and services” which is perfect because “much of Google’s revenue comes from ads served to PC users.”
Google and Apple don’t have the restrictions and difficulties of Facebook when it comes to making money. They don’t have to operate like a traditional corporation always has, either. That’s something Microsoft still wrestles with as it tries to adapt to the new internet and mobile dominated marketplace.
PCs aren’t likely to disappear anytime soon, but their position—and that of Microsoft’s—is no longer the core of our future technological development. Products and services that let us interact with the web to create relationships, do business, spread awareness, and simply communicate with others is now the basis for how we develop moving forward. Google is a prime mover in this development. That is why they are now in second place. Microsoft really has its work cut out for it if it wants to recover its influence and market value to beat Google’s. The internet is bigger than the PC, and it’s important that individuals and businesses recognize this and act accordingly.
Do you see the internet and mobile computing becoming more and more important in the future? How do you think things will change if Microsoft loses more and more influence?
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