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An intriguing but
eventually vicious three-way battle is emerging
between Microsoft, Yahoo! and Google for net supremacy. How each is
dealing with the competitive threat says a lot about their individual
company
culture, management and DNA. (If you're wondering why I didn't include
AOL, it's because their business seems to be moving in the
wrong direction, rapidly atrophying with nearly
900,000 fewer subscribers last quarter.)
Microsoft:
Microsoft
has recently made a concerted effort to hire even-keeled,
friendly liaisons within the community, giving them the authority to
speak for the company
and the authorization to pay off those that might speak negatively of
Microsoft. Behind the
scenes, however, it's still the same team running the show - management
that has been twice convicted
of illegal actions against competitors, and that sports a stunning lack
of
ethical
boundaries. Recent court documents from a fresh legal battle over an
employee
jumping ship to Google report Microsoft CEO Steve Ballmer throwing
chairs and screaming many
unprintable words, capped off with, ″I'm going to %$#@ kill Google!″
The
only way Microsoft knows how to operate is with an enemy in their
crosshairs. A few years back, Linspire (then Lindows) was the
recipient of Ballmer's profanity-laden tirades. But Microsoft's
attention has
since been
somewhat diverted from the ambiguous threat of Linux - which
doesn't
present a singular
target - to Google, whose O's make convenient bull's eyes.
Look
for Microsoft to employ the same approach they have used
historically
to fight competitors. First they will use technology barriers within
new versions of their operating system to dramatically favor their own
products and discredit competitors. With previous competitor DR DOS,
they embedded
intentional incompatibilities, spurious error messages and bogus issues
of compatibility. With Netscape, they
deeply embedded their own
products and falsely claimed they could not be removed. Expect much of
the same with Vista, their newest OS.
In
addition, look for exclusionary contracts that preclude computer
manufacturers from pre-installing links and software from Yahoo! and
Google on PCs they sell. With the same unethical management in place, a
legal process that takes years to litigate, and inevitable legal
penalties only representing
a tiny fraction of profits, you'd be crazy not to expect Microsoft to
extend the same
behavior you've seen over the last two decades
into the next.
Yahoo!:
Boxed
in by the brainiacs at Google and the massive distribution and
questionable ethics of Microsoft, Yahoo! would seem to be at a slight
disadvantage in the net supremacy game. However, Yahoo!'s management
has matured at a remarkable
rate and has an acute awareness of the behemoths they must operate
against.
Yahoo!
has taken a unique strategy to track movements of competitors.
Employees are asked to submit tidbits of information they hear to
management, and the
company coalesces these nuggets of knowledge into a more comprehensive
documents, which are then circulated more widely to help employees
understand
possible moves Microsoft and Google might make. Because they are
often competing for the same talent, working with same suppliers,
and receiving visits from the same companies, this "due diligence" is
remarkably
accurate. Yahoo! often takes meetings with companies they have no
interest in
doing business with just to scrape them for data about the industry and
what Google or Microsoft might be up to. It's rare when Yahoo! isn't
aware well in
advance of moves made by Microsoft, or
especially
those made by their Bay Area neighbor Google.
Just
knowing where your competitors are going isn't enough, of course:
you still need to compete. Yahoo! is combining Internet-based services
and
media like nobody else. (Watch for an amazing rich web interface
for
Yahoo! mail that has Silicon Valley buzzing.) They've even rented the
massive
MGM office in Los Angeles, which gives them several hundred thousand
square feet of office space to house executives moving down the coast
to be
close to Hollywood.
Google:
The
youngest company of the bunch lacks the ferocity of Microsoft and
the process of Yahoo!, but is maturing quickly. Astonishingly, three
years ago some at Google believed Microsoft wouldn't be interested in
their business. That naiveté was undoubtedly
erased when Microsoft
announced intentions to directly compete with their MSN search engine.
Google
is much more focused on continuing to innovate rather than
religiously tracking Yahoo! and Microsoft and countering their moves.
They do have
an internal ″industry″ mailing list where noteworthy news articles
are distributed internally, but nothing as formal as Yahoo! or
Microsoft
has. Screenshots of the early versions of Vista were circulated on
this list, heightening the awareness of the power Microsoft has to
impede Google on the desktop.
What
Google has done is open a local office right in Microsoft's
backyard of Kirkland, Washington, to recruit talent. To date, they have
convinced
more than 100 employees to leave Microsoft and jump to Google, and
virtually none
have migrated in the other direction. Microsoft is fighting back and
sued Google over one of those recruits. It is that lawsuit that
revealed Ballmer's tantrum towards Google.
Summary:
It's
impossible to predict who will ultimately prevail in the battle
for the net. You can expect some nasty-but-effective tactics from
Microsoft (with legal apologies and payouts years in the future). I
expect Yahoo! to continue to forge media relations, which they will
then leverage to build some exclusive products and services to offer
their subscribers. And from
Google, look for loads of experimentation and innovation in a wide
range
of areas seeking that next major profitable opportunity beyond the
search engine.
--
Michael
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