AH Tech Talk: Microsoft Vying For A Share Of Google's Ad Revenues

Microsoft launched Windows 10 on July 29th after a less-than-successful attempt three years ago at incorporating the distinct UX needs of touch-based devices with its much-criticized Windows 8 and 8.1 iterations. The dual unmitigated disasters meant that the Redmond, WA-based tech behemoth had to learn from the errors of its ways and rectify its follies if it had to keep its agitated OEM partners happy and have any chance of getting back its position of preeminence in the world of operating systems for computation devices, currently ruled by Google's Linux kernel-based open sourced Android. From all initial indications, the company seems to have done just that with the recently launched version of Windows, especially if there's even an iota of truth in the company's claims of over 14 million installations in just 24 hours since the official launch of the RTM version of the much-awaited software.

For the uninitiated, Windows 10 is the latest operating system from Microsoft that comes with a keyboard and mouse-friendly UI that is said to be easier to use on desktops and laptops than its immediate predecessors, Windows 8 / 8.1. For the first time in the history of the company, it is giving away its OS free of charge to users of previous versions of Windows; in this case, Windows 7 and Windows 8 / 8.1 users. Copies for brand new computers and upgrades for Windows XP users however, will incur charges depending on the version chosen. It is still intriguing that the company, which has thus far earned a lion's share of its revenues from its Windows division, would just give away the software for free. The reason, simplistically put, consists of just the one word - advertising. Of course, that would be oversimplifying Microsoft's reasoning, which obviously, is a little more complex and nuanced than that.

While Google has made an empire over the past decade and a half based on harvesting user-data to serve contextual adverts to users of its various services including mail, search etc. Microsoft has, for the most part, used the direct route to make money from end-consumers rather than from advertisers. The company recently even exited from its display advertisement business. With Windows 10 however, it can be said to be going the Google way - offer your services to the end-consumer for free and make money from corporations and enterprises by feeding them info about millions of users using the free services like search, mail and mapping, among its myriad other offerings. It keeps just about everybody happy up and down the value chain - the consumer who gets stuff for the low, low price of free; the advertisers, who get access to personal data of millions (in Google's case billions) of users; and the data-harvesting company (Google in this case), who gets to laugh all the way to the bank with boatloads of cash made from happy corporate partners.

As for Microsoft's latest strategy, the company discloses as part of its privacy policy that it doesn't share any "personally identifiable information" with anybody. In fact, it says that it doesn't even have access to much of that themselves apart from a unique hardware hash generated for each machine for activation and validation purposes. The company however, says that it shares information gathered from emails (Outlook), instant messages (Skype), search (Bing) and cloud storage (OneDrive) with advertisers "anonymously". All this seems to be in line with already established practices of companies like Google, Yahoo and other corporations that offer free email, search, mapping and cloud storage services. However with Microsoft, a lot of these services are built into Windows 10, which the company can leverage to get ever more personal information from its users, to sell advertisements against.

Google is able to target users with its strategic singular Google Account, which ties every single user across all their devices, making it easier for Google to target them with ads. Microsoft, albeit late to the party, seems to be catching on. The company has recently started giving away its best apps for free on Android and iOS, in order to get more people to use their services. Like Google, Microsoft also requires its users to sign into a singular, catch-all Microsoft account, in order for them to be able to use the company's various free apps and services across devices running Windows, Android, iOS or OSX. This ensures that the company will have extremely accurate info on each of its users, which will eventually allow it to better target those very same people with 'personally relevant' advertising. The Microsoft apps currently available for free on Android and iOS include Office, Outlook and the Cortana digital assistant, which is Microsoft's supposed answer to Google Now and Apple's Siri. Speaking about Cortana, the voice-controlled intelligent personal assistant from Microsoft is said to get incrementally "smarter" with usage, meaning that Cortana (and by extension, Microsoft), learns more about its users, the more they use it - information, which it can (and in all likelihood, will) then sell to advertisers to make even more money. Users of course, can opt out of advertising by using the relevant settings in Windows 10's 'Privacy' option under the 'Settings' menu. One can also go to a Microsoft-operated site to opt out of browser-based personalized advertising on Windows, Windows Phone, Xbox and basically, everywhere else, by simply logging into the designated Microsoft account attached to those devices.

Of course, this apparent change in strategy indicates that in spite of lagging Google's user-base by the proverbial country mile, Microsoft hasn't quite thrown in the towel when it comes to gunning for search-based advertising revenues. The company apparently still believes it can make a game out of it, with its Bing search engine being set as the default on its brand new Edge browser, which replaces the much criticized Internet Explorer as the default browser app on Windows 10. With Microsoft simply refusing to give up the ghost on advertising, Google can ill-afford to allow complacency to set in, and will want to keep an eye on its wannabe search rival if it has to protect its domain from being under-siege from one of its most resourceful rivals, who seems to be jumping into the fray with renewed vigor.

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About the Author

Kishalaya Kundu

Senior Staff Writer
I've always been a tech buff and have been building my own PCs since as far back as I can remember. My first computer was a home-built desktop running MS-DOS on which I learnt to program in GW-BASIC and my interests apart from technology include automobiles and sports.