Who’s Winning The Google v Microsoft Battle?

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He went on to claim that the Justice Department is “looking into whether Microsoft and Apple acquired the Nortel patents for anticompetitive means.”

Microsoft executives felt compelled to fire back.

“Google says we bought Novell patents to keep them from Google,” Brad Smith, Microsoft’s general counsel, wrote in a tweet on 3 August. “Really? We asked them to bid jointly with us. They said no.”

The same day, Frank Shaw, Microsoft’s corporate vice president of corporate communications, also Tweeted: “Free advice for David Drummond – next time check with Kent Walker before you blog.”

He included a link to an October 28 email sent to Brad Smith by Kent Walker, Google’s general counsel, suggesting that “a joint bid wouldn’t be advisable for us on this one.”

Rather than let Microsoft blow a hole beneath the waterline of his tight little narrative, Drummond updated his original post on August 4: “If you think about it, it’s obvious why we turned down Microsoft’s offer,” he wrote. A joint acquisition of the patents “that gave all parties a license would have eliminated any protection these patents could offer to Android against attacks from Microsoft and its bidding partners.”

Lonely at the top

A number of analyst estimates have Android leading the mobile market. According to recent data from Nielsen, for example, Android held 39 percent of the U.S. smartphone market, followed by Apple’s iPhone with 28 percent, RIM with 20 percent, and Microsoft with 9 percent. Similarly, research firm comScore placed Android’s share of the U.S. market at 40.1 percent, followed by Apple with 26.6 percent, RIM with 23.4 percent and Microsoft with 5.8 percent.

Combined with Microsoft CEO Steve Ballmer’s recent admission that Windows Phone’s market share is “very small,” it seems Android is handily winning the mobility wars despite Microsoft’s patent maneuvers. That being said, Microsoft seems to have found a viable source of revenue in its latest string of Android lawsuits and “royalty agreements,” something the company is likely to vigorously push in quarters ahead; Jack Gold, founder and principal analyst of J Gold Associates, recently theorised that Microsoft’s cash stream from Android royalties could even top that of Windows Phone.

Meanwhile, Google’s core business – search – continues to outpace Microsoft’s Bing, although the latter has enjoyed incremental market share gains over the past several quarters. Microsoft has demonstrated a willingness to burn hundreds of millions of dollars to keep itself in the search game, something that makes its investors nervous – but doesn’t seem to have any appreciable effect on Google’s ability to earn lots of cash from advertising.

So Android continues to handily dominate Microsoft in the actual mobility and search markets, but Microsoft has a variety of good legal cards to play in order to make life more difficult, both for Google and its manufacturing partners. In other words, look forward to some messy battles (and more irate blog and Twitter posts) to come.