Electronic Cash News

I keep asking myself - are Google and Microsoft in the same industry and are they really competitors. With the latest Microsoft and Yahoo merger talks, I would conclude that Google is a successful conglomerate transcending several industries while Microsoft is mostly a software company attempting to become a successful conglomerate.

Google is a conglomerate because it dominates several, seemingly unrelated industries to include software services and advertising media. They have used their unparalleled technology innovations to enable them to focus on profitable enterprises that transcend traditional boundaries. Previously, conglomerates were made possible by unique geographic circumstances (East-India company), leveraging capital through buyouts (ITT, Litton), and branching into financial services (GE, Sears) - see Wikipedia - Conglomerates for more information on the history of conglomerates. Now, Google has shown us a new conglomerate business model based on innovative software.

If Microsoft is desiring to merge with Yahoo to dominate the Small-Medium Business (SMB) internet space, this is good because Microsoft and Yahoo! are strong in supporting small and medium size businesses. If Microsoft is merging with Yahoo! to be like Google (a successful conglomerate), this seems to be an ill-fated purpose. If Microsoft and Yahoo! want to be like Google, they need to focus on innovations versus acquisitions. Is Microsoft missing their SMB opportunity chasing after Google? See Joshua Greenbaum’s article, Can Microsoft and Yahoo Do More Than Sell Ads? The SMB Opportunity