Is Microsoft Corporation Becoming the Next Google?

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Some folks may still remember when Microsoft founders Bill Gates and Paul Allen were considered the ultimate innovators. Whether you're a fan of Microsoft or not, there's no denying it took a starring role in what would become an exploding PC industry, and Gates' dogged determination to support Internet growth across the globe nearly 20 years ago played an important role in getting the web where it is today.

Somewhere along the line, it could be argued ex-CEO Steve Ballmer was the culprit, Microsoft lost its mojo. Much like the old IBM , Microsoft was perceived by investors and industry pundits as a slow-moving behemoth in a lightning-fast world. With the loss of Microsoft's innovative touch, Google was more than happy to fill the void. But with a new CEO, a new culture, and several cutting-edge technologies on the horizon, Microsoft may well be on its way to earning back its place as the leader of innovation.

The case for Microsoft
It's clear CEO Satya Nadella's mobile-first, cloud-first mantra is taking hold. Microsoft's shift in focus to new, cutting-edge markets like cloud computing makes good business sense, and just as importantly, it's also helped change the culture of what had become a stagnant, sleeping giant. It seems investors perceive the change in Microsoft, too. When Nadella took the helm on Feb. 4 of this year, Microsoft's stock was sitting at a ho-hum $36.35 a share. At nearly $46 a share today, longtime shareholders are finally being rewarded, and the sense that Microsoft is entering a new era is partly responsible.

Nadella's "Bold Ambition & Our Core" open letter to Microsoft employees says it all: "The day I took on my new role, I said that our industry does not respect tradition -- it only respects innovation." Nadella wasn't simply spewing the party line regarding innovation, either.

Microsoft recently took the wraps off a new prototype that could knock the virtual reality, or VR, world on its head. Dubbed "RoomAlive," Microsoft's VR innovation, gives its Xbox One users the ability to turn an entire room, every square inch of it, into an immersive virtual world. Just as important as the potential of RoomAlive as a commercial gaming product is, it's also an example of Microsoft thinking outside the box, just like the good ol' days.

Some folks may not see Microsoft's new Surface Pro 3 as innovative, but it is. By introducing an entirely new form factor, Microsoft wants to change the tablet-laptop landscape, and by most accounts, it's working. The Surface Pro 3 has earned solid reviews from industry pundits, and early sales estimates are positive as Microsoft tries to keep up with demand.

Turns out, Microsoft engineers may not be done with the Surface Pro 3, and a new technology would really make it an innovative wonder. Microsoft's working on a "smart" transparent cover that uses piezoelectric sensors that measure external forces like pressure and speed and converts them to an electrical charge. The Pro 3 cover is akin to a transparent piece of paper that allows users to "peel" away layers to view what's underneath, among other innovative functions. Like its RoomAlive VR product, a transparent smart cover is a prototype, but that doesn't detract from the fact that Microsoft is spreading its innovative wings -- again.

The case against Microsoft
Though Google opponents point out there are legitimate questions as to whether its cutting-edge innovations have a legitimate business case, there's no denying it's presently the king of innovation. One look at its Project Loon balloons to beam Internet access to the world's unconnected masses speaks volumes. Will people really sit back and let sensors and computers drive their cars for them? Who knows, but the fact that Google is even exploring a world of driverless cars demonstrates its innovative tendencies.

Like driverless cars, there are questions from both a commercial and regulatory perspective surrounding Google's connected Glass product, but it's a perfect example of pushing the proverbial envelope. Google doesn't shy away from even the craziest-sounding project, which is what innovators do, even if there are failures along the way.

Final Foolish thoughts
Microsoft's new technologies aren't enough to boot Google off its perch as the leader of innovation. But these latest introductions, even if they're still in prototype stages, prove that Microsoft is ready to go back to the future -- a time when it was at the forefront of new technologies. If Nadella keeps moving Microsoft along its current path, shareholders will once again benefit from owning the world's most innovative company.

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The article Is Microsoft Corporation Becoming the Next Google? originally appeared on

Tim Brugger has no position in any stocks mentioned. The Motley Fool recommends Google (A shares) and Google (C shares). The Motley Fool owns shares of Google (A shares), Google (C shares), International Business Machines, and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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