The value of Google has now surpassed the value of Microsoft according to stock market capitalisation figures. Sub one per cent movements in stock values in New York last night finally tipped the balance in favour of Google, valued at $249.2 billion, compared to Microsoft with a $248.7 billion valuation. (Apple is currently valued at $632.9 billion)
A report on Bloomberg Businessweek headlines the story as “PC Loses to Web”. Google started out as a search engine created by university students and now that search engine is the most popular on the web, controlling 66 per cent of the US search market. Google also make the world’s most popular mobile OS; Android, which powers 64 per cent of smartphones. Google’s income is mainly from online advertising revenue.
Microsoft also operates online businesses but these are relatively unpopular compared to rival Google offerings. Microsoft still makes most of its money from Windows and Office software on PCs. As Microsoft try and push into Google’s strong territories of web search and mobile operating systems Google has sought to create alternatives choices to Windows and Office. The two companies appear to be battling on many fronts. The way that Google’s and Microsoft’s share valuations are trending it looks like the market believes that Google is winning this war.
Google has had the advantage recently of backing industries that are growing. The most obvious examples are the smartphone, tablet, search and cloud computing markets which seem positively vibrant compared to the PC based market upon which Microsoft bases its core business. Microsoft has seen these Google successes and tried to make a move but earlier movers always have an advantage.
Microsoft has come from behind before, notably with the Xbox series of games consoles, in a very competitive market. With strong hardware, software and cloud offerings the Redmond, Washington based software giant has a good chance of taking over in some of the markets in which Google (or Apple) is currently the leader. Microsoft has a lot of product launches coming up in the near future, perhaps it will be able to retake second position again soon?