Google Vs. Microsoft As Mothership

The consensus is that Tuesday's news about Salesforce.com's "strategic alliance" with Google added up to less than a huge whoop.

For weeks rumors floated about an upcoming pact between the companies. The fact that Salesforce.com is now, in essence, reselling Google AdWords with its SMB offering was something of a yawn. After all the companies already had an AdWords-related alliance.

A Salesforce.com spokeswoman told Bloomberg News that the impact of the agreement was "not material" to either company. Funny, you'd never know that from the other rhetoric being thrown around in the big build up.

What is important about the deal, which Salesforce.com flogged with its usual gusto, is that it shows third-party software (or in sf.com's case NO-software) companies continue to glom onto Google as fast as they can as a hedge against that other software power. The one in Redmond.

Intuit, the king of home and SOHO accounting, announced a similar move in September. NetSuite also works with Google AdWords. Stay tuned for a flurry of other announcements from SaaS players embracing Google Gears for offline support.

Saelsforce.com strategy vice president Bruce Francis acknowledged that this rush to Google is reminiscent of the flight to Netscape during the dot-com boom. Netscape was the anti-Microsoft then, as Google is now.

Francis remembers all those announcements in the Valley with Barksdale talking about Netscape One. "It was all pretty exciting. What we saw then was Microsoft was able to squelch the distribution of that product and if you look at all the failure factors, that was the big one. We''re just in a different world now," he noted.

Of course, folks like to portray Microsoft with its ever-deepening stack as "evil" and Google is by its own definition "not evil." (If you don't believe it, just ask it.)

Both companies are flush with cash. But Google has a lot of room for ISV partners to play and the knock on MIcrosoft is that it's not leaving a lot of room for them to maneuver. That gets back to the age old question: Is Microsoft a platform player or a soup-to-nuts software provider? You can argue both ways.

That dynamic could shift, but right now, Google looks to be a better bet for many software partners.