Google Has Microsoft Rattled

By CBR Deputy Editor Matthew Aslett (Jason Stamper is on vacation)

While the ‘flowery’ language used by Microsoft CEO Steve Ballmer to respond to the news that another of the company’s charges was planning to leave the company to join Google has inevitably hogged the headlines over the weekend, the really interesting thing about the story is that it indicates just how rattled Microsoft is by the search firm.

The legal battle over Google’s attempt to hire former Microsoft VP Kai-Fu Lee to head Google’s new product research and development center in China had already indicated a level of animosity between the two companies, but Ballmer’s apparent response to the resignation of former Microsoft engineer, Mark Locovsky, suggests just how much Google has got under Microsoft’s skin.

According to the sworn evidence of Locovsky, when Ballmer learned that Locovsky was to leave Microsoft after six years to take a job at Google his response was to pick up a chair and throw it across the room, before launching a foul mouthed tirade against the search firm and its chief executive, Eric Schmidt.

"F___ing Eric Schmidt is a f___ing pussy," Ballmer is alleged to have said. "I’m going to f___ing bury that guy, I have done it before, and I will do it again. I am going to f___ing kill Google."

While Ballmer has issued a statement describing the account as "a gross exaggeration" and "not accurate", the image of Ballmer raging about the former Novell and Sun executive will be difficult to shake and is all the more believable given Ballmer’s declaration that Microsoft was "hell bent and determined" to challenge Google for search engine leadership as long ago as September 2004.

While search and related services are the core battleground between Google and Microsoft, these are fast growing but peripheral activities for the world’s largest software vendor, and it is perhaps the potential threat that Google poses to Microsoft that explains why it has become such a thorn in the side of the software giant.

With its desktop search, email, blog, and photo editing software, Google is increasingly encroaching on users’ desktops, previously the almost exclusive domain of Microsoft. Additionally Adam Bosworth, Google VP of engineering (and Microsoft’s former senior and general manager) has spoken in glowing terms in the past about the browser-based software-as-a-service model championed by the likes of Salesforce.com.

Among the rumors that constantly fly around the Internet is the thought that Google might one day increase its ubiquity to the point where it could launch its own browser, or even a web-based suite of office applications as a challenge to Microsoft Office.

It’s an interesting notion, and one that has increasing potential the more you think about it. While there are a significant number of Office users that need the advanced functionality of Word or Excel for work, for the vast majority of consumer users that functionality goes largely unused.

Could Google, by providing a web-based text editing interface and a place to store files and access them from anywhere in the world via a browser, grab some of Microsoft’s massive office applications market share?

At the moment rumors of Google Office are just that – rumors – but the potential is clearly there, and that potential might just be enough to explain why Microsoft is apparently so rattled by the search firm.

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