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Microsoft seemingly tries to dominate every software market in both the consumer and enterprise landscapes. Windows and Microsoft Office would be enough to sustain most vendors, but Redmond wants more: databases, cloud computing, e-mail, search, virtualization, unified communications, Web browsers, mobile phones and tablets, even video games.
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Sometimes, Microsoft blurs the lines by forming tight partnerships with competitors, as it has done with Citrix and Yahoo. Here, we'll focus on the rivals we think pose the biggest threat to Redmond and give a status update on each rivalry.
Microsoft expresses more public animosity toward Google than Apple, but Apple is the one that passed Microsoft in market capitalization to become the world's most valuable technology company. It's easy to see why. Although Microsoft nearly snuffed out Apple long ago by dominating the PC market with Windows, Apple's Mac business has remained lucrative and Steve Jobs came roaring back with market-changing products like the iPod, iPhone and iPad. Although Windows still powers 9 out of 10 desktops and laptops, by some counts, Microsoft is far behind Apple in the smartphone and tablet markets. Windows Phone 7 hasn't halted the momentum of Apple, and Microsoft's vow to overhaul the next generation of Windows to adapt to touch-screen devices indicates that even Redmond realizes Windows 7 isn't a consumer's first choice for a tablet OS. Unless customers start demanding a "Windows start menu" on their iPads, Microsoft won't be anywhere close to catching Apple.
Google could become the second technology company to pass Microsoft in market capitalization, although Microsoft's $232 billion market cap is still significantly more than Google's $195 billion. Microsoft and Google compete on so many fronts it takes awhile to list them all. Google vs. Bing, Android vs. Windows Phone 7, Hotmail vs. Gmail, Windows Azure vs. Google App Engine, Microsoft Office vs. Google Apps, Internet Explorer vs. Chrome, and Windows vs. the not-quite-yet-released Chrome OS.
The public spats between Microsoft and Google can be so comical that a recent dustup over allegedly stolen search results led to a Register article headlined, "Google and Microsoft relive Joan Collins catfight," and the comparison didn't seem like a stretch. Sometimes the fights happen in blog posts and Twitter insults, and other times the companies go to court. Google executives have prodded Microsoft by releasing details of Internet Explorer and Windows vulnerabilities when Microsoft's security team dragged its feet in resolving them, and both Microsoft and Google have released add-ons for each other's browsers in order to plug supposed gaps in functionality.