Google Boosts Cloud Computing Apps -- Should Microsoft Worry?: Page 2

In fact, Dortch of FOCUS points to maintenance as one of Microsoft’s disadvantages, but not in the way you’re probably thinking. “When you grow to be as big as Microsoft, you lose some of your ability to innovate. Instead, you must spend a lot of time supporting, maintaining and upgrading the things that make you money,” he said.

“One of the smartest technology quotes I ever heard came from Bill Joy, one of the founders of Sun. He said ‘innovation happens elsewhere.’ The problem companies like Microsoft have is that they’re so big that they stop paying attention to those elsewheres, forced instead to focus inwards,” Dortch said.

Thus, instead of being an early mover in the cloud, Microsoft had to spend its time and resources maintaining and updating Office, Windows and a slew of other existing applications. Of course, this doesn’t mean you can count them out when it comes to new technologies.

First-movers are rarely the winners in the tech innovation game, but when the competition comes from other deep-pocketed companies like Google, it could put Microsoft at a disadvantage.

(Microsoft did not respond to requests for an interview in time to get their point of view into this story.)

Another anchor weighing down Microsoft is its outdated licensing model. Businesses are tired of being locked into the expensive, shrink-wrap, per-CPU licensing model.

“There’s a lot of pent up hope in the enterprise that new software purchasing – or renting – models will arise. Google is considered an instrument of change,” Dortch said.

And it’s not just Google. Salesforce.com’s AppExchange, Apple’s App Store, and, yes, Google’s App Marketplace all provide function-specific apps and add-ons that are not only easy to pay for, but also easy to dump if you don’t like them.

Not Everyone Goes Google

Despite all of the gloom and doom in the press about Microsoft’s future, the fact remains that Microsoft owns the desktop, owns productivity and has a long established relationship with the enterprise.

In fact, many analysts believe that Google’s success will come with SMBs that aren’t locked into the Microsoft world. That may be true, but plenty of newer companies are deciding to hitch their wagons to Microsoft.

Leaf.ly, a company founded a few short weeks ago, looked at Google, Amazon and Microsoft and decided to go with Microsoft. Leaf.ly has sets its sites on being the Yelp of medical marijuana, and you would think that a progressive company like Leaf.ly would be hesitant to embrace a status-quo provider.

But that is exactly what Leaf.ly did. They selected Windows Azure and a cloud-based version of SQL to host and manage their website.

“Google is appealing cost-wise, but we saw benchmarks that show it choking at very large scale,” Scott Vickers, co-founder and engineer with Leaf.ly. For a brand new company, that’s a pretty optimistic reason to choose Microsoft. More importantly, though, Microsoft had launched a program that appeals to startups like Leaf.ly.

Leaf.ly was accepted into Microsoft’s BizSpark program, a program that drives down costs and delivers other benefits like community support and access to software they probably couldn’t afford otherwise.

BizSpark is just one of Microsoft’s efforts to push back against challengers like Google. The fact that startups like Leaf.ly are being won over by such programs shows that it would be foolish think Microsoft isn’t a strong contender.

Smartphones and the Cloud Converge to Favor Google?

One final thing to consider as the battle for the cloud rages on is the smartphone. The convergence of cloud computing and the smartphone will radically change how apps are developed, delivered and consumed.

Here Google has an even bigger advantage over Microsoft than in the cloud. While Windows Mobile has been confined to a small corner of the market, Android has been threatening the likes of Apple and BlackBerry.

“Smartphones are a major part of the story,” Sheth of Google said. “But it’s not just smartphones, but other post-PC devices, such as netbooks and tablets. What’s the least common denominator for all of these devices? The browser.”

While Explorer may be the browser of choice for most people, well ahead of Chrome, Google’s worldview is predicated on the browser. And Google believes, to update an old saying, that all browsers lead to Google.