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How Google Clobbers Microsoft

Stocks in this article: GOOG MSFT FB AAPL

What about the smartphone? I actually think Windows Phone is an excellent product, with the OS performance easily holding its own against the iPhone and Android. The problem is that being equally good -- or even slightly ahead -- is not likely good enough.

Microsoft is late to market, and many of its cloud service tie-ins are arriving late to market, or aren't there at all. That said, Microsoft should be a player here -- far, far behind Google and Apple.

This brings us to Windows 8 for the PC. Do your friends salivate at the idea of upgrading to Windows 8? No and neither do mine. Some are curious to try it, as they have some hope that it might turn out to be something interesting. Sadly for Microsoft, the people who have tried a Beta version have almost uniformly sworn to never get it, running into the arms of Apple and Google instead.

I like some of Microsoft's products. Windows 7 was a success. Windows Phone is a solid product. Skype is dominant. The Xbox 360 is best in class. Outlook has no decent competitor from Google or Apple. However, these positives are not stemming the overall tide.

The tide carries a market share shift in only one direction: Out from Microsoft, and into Google and Apple. Apple has been the stock market's darling for a few years now, and for good reason. Google, however, is coming on strong, taking market share from Microsoft Office and other cloud services.

When Windows 8 largely fails in the coming months, as I expect it will -- lack of interest in an upgrade cycle -- and Google makes its push for the Chrome OS PCs (Chromebooks and Chromeboxes), people will see much more clearer how Google's growth rate will continue to be vastly superior to Microsoft's. For Google, Apple is the toughest competitor -- not Microsoft.

At the time of publication, the author was long GOOG, AAPL and FB, and short MSFT.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

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