Apple Officially Writes Off Microsoft, Moves Sights to Google

I wrote off Microsoft long ago. Except the Mac Business Unit - I think Office for Mac is a great product. Seriously, though, under Steve Ballmer's leadership, Microsoft has largely floundered, moving from one blundered catch up project to another.

In a few short years, the company has gone from being a scary-ass giant that seemed certain to drown the tech world in a sea of mediocrity to an embarrassing old uncle with lots of money and dreams of faded glory shambling along in a pantomime of his past accomplishments.

Big Redmond -- and that analogy to IBM and its age of dominance no longer seems as apt as it once did -- is still dominant in PC operating systems, but who cares? The world, including Microsoft, follows what Apple is doing, leaving the company in the driver's seat in the PC world, even with its tiny, but growing, market share.

Microsoft is a bit player in the world of online music downloads and digital media devices, and is increasingly becoming a has-been in smartphones, despite (or maybe because of) having been an early player in that space. The Xbox platform is doing well, though, so rock on there. I think the company may even be close to making back all the money it has spent on that project.

Bing may turn out OK, though I strongly doubt it will unseat Google as the search king. Indeed, I'll be surprised if Bing can become even a strong second to Google in that arena.

And speaking of Google, I found it fascinating yesterday to see this graph from Changewave Research:

Changewave Graph

It's a customer satisfaction graph for smartphone operating systems. In this survey, there are precisely two OS developers with a majority of customers who really like ("Very Satisfied") their smartphones, and those two companies are Apple (iPhone) and Google (Android). RIM's BlackBerry, the platform that was once considered so über-awesome it was colloquially called "CrackBerry," is a distant third behind these two companies with a little more than a third of its customers in love with their devices.

And RIM is a smart company with lightyears more vision than Microsoft (shockingly dead last on this graph), and the best they can do is 41%?

That graph is a telling one in that it demonstrates that Google is a company, like Apple, capable of making products that people like. Like Apple (post-Steve's return), Google has had very few public missteps, and the products that see the light of day tend to be a hit with users. From to AdWords and AdSense, to Gmail, to Android, the company makes products (and services) that don't suck.

It's one of the reasons that Google CEO Eric Schmidt was (until recently) on Apple's board of directors, and one of the reasons Arthur Levinson sits on both company's boards. Steve Jobs and Mr. Schmidt respected each other and their respective visions, and both companies were seemingly fighting Microsoft in their respective markets.

Now, however, Google and Apple have some overlapping areas of competition. They both have browsers, they both have operating systems for computers, and they both have a smartphone operating system. I personally thought that it was only these areas of overlapping competition that lead to Mr. Schmidt resigning from Apple's board, but the Quattro purchase has made me rethink that notion.

If Apple is going to enter the market for mobile ads -- a move that I find curious, at best -- it suggests to me that Apple sees Google as its main competition going forward. It may have something to do with the unannounced tablet device, or it may be all about the iPhone, but with this purchase, Apple is saying it intends to be a player in the market that Google's Mr. Schmidt has publicly identified as the biggest ad market of the future.

And in doing so, Apple is signalling that Google is the competition, and not just in the smartphone OS market where Windows Mobile was never the target for Apple, but in the bigger picture.

I personally always liked the idea of an alliance between Apple and Google, two companies for whom mediocrity was never acceptable, but that was only because of the threat from Microsoft. Now, however, I'm thinking that competition between those two companies as leaders could be even more exciting as the two tech giants force the rest of the market to push for their own excellence.

If only Google believed in a Whole Widget approach, then we'd really have a great horse race.