The difference between GOOG and MSFT in these situations is pretty heavy. Yes, one product is supporting four or five in terms of profits. But there's a key fac

The difference between GOOG and MSFT in these situations is pretty heavy. Yes, one product is supporting four or five in terms of profits. But there's a key factor that you're missing. Looking, specifically, at this: http://saviorodrigues.wordpress.com/2010/02/12/microsofts-profit-by-division/ http://saviorodrigues.wordpress.com/2010/02/12/microsofts-pr... Does uptake in online services increase profit in Office or Windows? Does uptake in Entertainment and Devices increase the profit of Server and Tools? (Tools, perhaps, in terms of IDEs). The key difference is this: all of GOOG's non-ad products are loss leaders. They increase internet usage - specifically, internet usage on pages that run GOOG ads. As long as their loss leaders increase the profit of their main product, they win. Investments in Google's side products (email, maps, etc) create a feedback loop, putting more eyeballs in front of their profit machine (ads). They really are in the best position - the more people that use the internet, the more money they make. That's why they're so keen on doing things 'pro bono' - like their fiber initiative, and Android.