Google launched the first shots when it released Google Apps and announced plans for a new computer operating system. Now, Microsoft has hit back with plans to release its popular Office applications online and by signing a search deal with Yahoo! Ross Bentley reports on what this could mean for the world of hospitality.
There's a battle royal going on between two of the biggest names in computing.
Last month online giant Google and the world's biggest software company, Microsoft, made a number of announcements that more than ever put them on collision course.
First, Google released plans to launch a new operating system next year, a development that could see it steal market share from Microsoft in the PC market. But Microsoft hit back by announcing plans to offer free, web-based versions of its popular Office applications, such as Word, Excel and PowerPoint. It also made public a search deal with Yahoo! - moves that trespass on Google's turf.
But what does all this mean for users in the hospitality sector?
Google says its new operating system - called Chrome OS - is its attempt to "rethink what operating systems should be" and that it will initially be targeted at netbooks and other lightweight devices.
"We're designing the OS to be fast and lightweight, to start up and get you on to the web in a few seconds," says Sundar Pichai, vice-president of product management at Google.
"The user interface is minimal, to stay out of your way, and most of the user experience takes place on the web. We are going back to the basics and completely redesigning the underlying security architecture of the OS so that users don't have to deal with viruses, malware and security updates. It should just work."
The move is a direct attack on Microsoft, which currently dominates this space with Windows, says MG Siegler, who runs a popular blog, TechCrunch. "This is Google dropping the mother of all bombs on its rival," he says.
However, according to Elizabeth Dimbleby, development manager at hospitality software company Fretwell-Downing Hospitality, because Chrome OS is initially intended to run on individual devices it won't have much impact on business users in the short term. "What will be interesting is what Google will do next - will they attempt the server market?" she says.
"In this case, software developers might look at the languages and features that it uses to see if it is worth making the jump from Microsoft and cross-train on the new system."
At another hospitality software firm, Fourth Hospitality, technical director Christian Berthelsen also believes it is too early to tell what impact Chrome OS will have.
"It's always interesting to see giants like Microsoft and Google having a go at each other, but this is just the early stages, and opinion on what Google is doing is divided," he says.
"Google is taking on a high-risk strategy, which is very much in their make-up, as they tend to try many types of innovation of which some work and some fail."
Of greater immediate significance to hospitality businesses, he says, is Microsoft's plans to make some of its key applications available over the web in 2010.
Commentators say this move reflects the competitive pressures Microsoft is feeling, particularly from Google.
"The fact that Microsoft is developing it at all is a response to Google," says analyst Matt Rosoff, of Directions On Microsoft. "This is a move that they probably wouldn't have made if they didn't have to, but there is enough competition bubbling up that they thought they needed a response."
And Berthelsen thinks the end result will be the availability of Office applications that are cheaper and easier to use.
He says: "Everyone knows how to use Word and Excel and, if it becomes web-based, that will represent a more natural evolution than changing your operating system.
"This is where software-as-a-service is such a huge step forward for hospitality firms, because it means you don't have to worry about the underlying technology behind your system, and you avoid a lot of the pitfalls of trying to keep up with innovation and gambling on new technology and its success."
Berthelsen says there is no need for hospitality firms to change anything at the moment but that eventually they will see the benefits of Microsoft's strategy.
He adds: "The bottom line is that all software should be web-based, because everyone wants their software to be cheaper and easier to use, and that's where Microsoft is going."
The implications of a 10-year web search and advertising partnership between Microsoft and Yahoo!, signed on 29 July, are also unclear at present. But commentators say the alliance is likely to create a serious rival to Google, which dominates both of these markets.
Microsoft relaunched its search technology in June under the name of Bing and is hoping the deal will increase the number of people who use the service and, in turn, its online advertising platform. Yahoo! will use both of them on its websites and no longer have to invest millions in search and advertising technology.
The big question is whether the new partnership will be able to threaten Google's dominance in web search, which last year hit highs of around 87% of UK market share, according to research firm Hitwise.
Commentators have said the deal might see users convert to Bing. It is also widely thought the move could result in improved search technology and, therefore, better search results for users as competition in this space intensifies.
One thing, however, is for sure: the battle lines between Microsoft and Google have been drawn and the struggle is likely to go on for years to come.
Billy Waters, IT manager at Yo! Sushi, gives his verdict on the Google and Microsoft announcements.
Do these announcements mean anything in the short term?
Free, lightweight operating systems have been around for a while, but Chrome OS will draw the attention of the non-technical public, who are familiar with the Google brand, and make them aware of an alternative to Microsoft Windows.
What are the implications for business users?
I see this as much more consumer-focused at the moment. In the business world many companies simply are not able to move away from their current MS environment due to compatibility issues with third-party business apps, although increased adoption of software-as-a-service could aid this.
Are you interested in Google OS?
Currently, Google OS is not something I would consider, although I can see advantages of Google Apps for our restaurant site managers, particularly as we try to move away from Microsoft Office outside of our main office.
Do you think the Microsoft-Yahoo! deal will lead to changes in the web advertising market?
The Microsoft-Yahoo! deal will increase their search engine market share and, in time, the increased competition with Google will give advertisers food for thought on where they advertise, leading to a more competitive market. However, MS-Yahoo!'s first challenge is to entice users away from the favoured and reliable Google.