and Bill Gates' economic model is SHIPPING software...a lovely alternative

Microsoft's economic model can't be thwarted by a firefox plugin.

He is right to mock the "we're changing the world with every product" shtick.

Google is great at search. Just like Microsoft is great at software and XBox. But that makes Microsoft a two-hit wonder, so I'm not sure they are in any position to mock someone for a lack of product diversity.

And this is why GOOG isn't even worth $400 / share. Don't be shocked if they hit $300; neither their growth nor their margins are sustainable.

Xbox is a money pit. $2 billion and counting. MSN defines mediocrity. One trick pony too...

I second Bill. And NOT just to get him to connect with me on LinkedIn.

@MarkTheMarketWatcher: If I'm not entirely mistaken, last year Microsoft announced a $1+ billion splurge on extended warranties and free replacements of their failing Xbox 360 hardware (the epic "Red Ring of Death" plague of 2006--).

Also, IIRC, their Xbox branch (including their Game Studios) have -- to date -- had two (2) quarters in the black. (I think both occurred during the launch windows for Halo 2 and 3, respectively.)

I.e. they're still losing some serious coin on the Xbox, and they can't build 'em right.

I gotta chime in and agree with Bill. Google is fantastic at search - wipes the floor with everyone else. Gmail is pretty good, but nothing I couldn't live without. I don't use any other of their products, GTalk is nothing but a google branded jabber server - if they did call that a world-changer, they deserve the ridicule.

That said, I'd bet on Google above Microsoft in the long term. Almost everything a consumer needs can now be done on the web, or with a range of software - MS's relevance is disappearing fast. Microsoft owns the corporate market, sure, but they don't have the domination of every space they did a decade ago. I think they have permanently lost the consumer space, they just don't get it anymore. Would Symantec launch a social network? Of course not, and MS should stick to its knitting too.

Of course, I don't know why BillG is down on GOOG when his company bought into Facebook at the most ludicrous over-valuation I have ever seen. $15bn! And they bought a chunk of that. Google may not be the next Standard Oil but at least they have a working business plan with steady profits. I would honestly be surprised if Facebook ever makes a profit - I will be awestruck if they manage to retain their relevance even to the end of this decade, and maybe they'll lose it even before then - the FB shine seems to be fading fast according to my readings, anyway. GOOG's here to stay, they might be overvalued right now, but no-one can deny that they're worth a lot.

It's a nice line smacking Google for stuff that they suck at(productivity applications to combat office).

But Google doesn't have to win that battle (nor, in all likelihood will they).

However, Microsoft is more or less irrelevant on the web (search, social networking, advertising, etc), and while they might buy Yahoo, they have a long way to go to matter in that space. And that business is worth all that and a bag of chips -- Being the dominant player in online advertising over the next decade is going to be pretty much the big play..and $1000 a share for that company is going to look like a bargain if they can pull it off.

But, yeah, Google's got along way to go to become a player in the productiivty suite business...

He's right, but he could've picked on one of many other Google products that people don't actually use. I mean, Google Talk hasn't and won't change the world, but there are certainly worse Google products.

I agree with Bill.

Google does search.. very well. Aside from that I'd be willing to bet not one of their applications could present a viable business model on its own.

exactly. let's not forget GOOG is also is great PR/Hype machine. surprised there is not greater scrutiny regarding their use & drain on natural resources (e.g., fresh water, energy) via their server centers. Instead the press is all Googly-eyed with their PR announcements on Green Initiatives, Space Travel, etc.

gtalk is really important, for many it legitimized Jabber and accelerated acceptance of the standard. AIM has stopped resisting the intrusion of Jabber into its universe and is now opening its borders.

this isn't exactly a newsflash, but microsoft's success is based on getting you locked into their methods now, and getting them to work well later.

google's success is based on smart technology.

sure, in ten years google, and anyone paying to access their databases, will know you have to take a crap before you do.

but for now, let's get one thing straight: google represents the future and microsoft the past. microsoft has been leapfrogged by google in areas that will dominate the financial landscape for years to come.

I can't explain any better than this video:

[video.google.com]

...why the Microsoft model for office interaction is such a disaster. Even in an office environment with well managed central servers there has to be a lot of cooperation among all the players for things to not get all messed up.

The key thing is NOT how fast or formidable the document editing capabilities are, but how the sharing works. A very simple editor along the lines of Wordpad will do 99.9 percent of what 99.9 percent of people do when sharing documents. Even character-mode Novell networks had document sharing figured out better than Microsoft ever has.

Google's work, with the exception of search has been quite sloppy, and there is plenty of room for someone, even Microsoft, to knock them out of the lead.

But the same people who brought you a bloated operating system and a bloated office suite are not likely to suddenly offer up a well-designed tightly-coded standards-based online alternative.

Cudos to whoever does it first (but don't ask me to pay $400 and up per year to use the thing). I do like Googles model of giving a basic version away and charging for a premium version. Google is doing formally what Microsoft did unethically and surreptitiously when it looked the other way on piracy issues while Office was in its infancy.

I agree too, I remember the day they announced the Gtalk thing, the press release whas crazy: it looked like they were going to launch the first VOIP client in the history of the net. I had a great laugh back then...

Google has never invented anything: they copy or buy ideas, which is not bad, but i really dont know what they do with such an ammount of brilliant people...

Can someone name something invented by Google?

Here's the video of Bill comparing SharePoint and Google Apps:

+ Watch video

@macbeach: You are vastly wrong about enterprise collaboration/office suites. There is a reason Sharepoint is Microsoft's fastest growing product. I'm not a Microsoft fan boy -- far from it -- but I have lived and breathed enterprise IT for 10 years and I know how corporations think and work.

It's obvious you are a Google fan boy, so arguing is pointless. How about we come back here in a year or two and check the scoreboard? All of Google's enterprise products will be still be irrelevent and ignored by companies larger than 4 hackers sharing an apartment. Google will be bleeding cash keeping 16,000 people paid to maintain a pretty good search engine with decreasing advertising spends and a collection of nifty but pointless (and unused) toys.

If Microsoft's product is faster they might have a chance.

@OaklandTechie:"It's obvious you are a Google fan boy, so arguing is pointless."

I assure you that arguing with me is pointless in any event. But what tipped you off that I was a Google Fanboi? Was it this?:

"Google's work, with the exception of search has been quite sloppy, and there is plenty of room for someone, even Microsoft, to knock them out of the lead."

As a retired IT worker who started 20 years before you got into the business I'll admit to little knowledge of Sharepoint. I decided to quit rather than continue apologizing for being a part of what made so many office workers lives miserable. As such (stay-at-home retiree) Google does the job for me, and I think is adequate for most home and small businesses (which is where most business is conducted and where I still do some consulting).

Note to Valleywag: If you decide to fold this online publication before a year is up, please leave this thread running so OT and I can meet here to settle this issue.

TIA.

Okay, but Google didn't ship out acres of faulty chipsets to help Intel make their earnings.

@macbeach: Gee, it must have been the Google Docs video you started your post with that tipped me off.

While Sharepoint may indeed be Microsoft's most boring product, it has been solving the problem described in that precious Google video since 2003. That's the entire point of having a collaboration space -- to get attachments out of email. Google hardly invented the idea of collaboration in the enterprise. Hell, neither Microsoft (Lotus did).

Google's only advantage here is a) it's free or somewhat cheap (enterprise version) b) it's in the cloud, as opposed to installed inside the DMZ. With the annoucement of the online Sharepoint, not sure Google has much of an advantage anymore.

Which leads back to the original point of Bill's quote: a press release and a set of slick technologies doesn't make corporate IT departments change. Google has a long way to go here.

Oh yeah, and my total industry experience is 15. Just 10 in IT. I was on the product side before. Sharepoint - boring? Sure, but make $150k a year supporting it (amoungst other things). I'll stay bored for that kind of money. I don't even *like* Microsoft, christ.