Microsoft and Google: Internet Giants Return to Basics

Microsoft and Google have more in common than the dominance of their respective markets. Both are also essentially one-trick ponies that have used their prodigious cash flows to pursue many side projects in attempts to diversify. And neither has had much success.A trying economic climate is reining in their efforts. Google, the more recent empire builder, just axed its print advertisement ambitions, and Microsoft sold its long-held stake in the cable operator Comcast. Their other noncore projects should be next.Microsoft’s core expertise remains software — its ubiquitous operating system and other programs. These account for 82 percent of its revenue and nearly all of its operating income. The company has used a lot of those profits to support forays into products like video games and online search.

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