Google Inc.'s (NASDAQ: GOOG) Google Apps project has gained steam (and customers) since its introduction a few years ago. Although it's not yet a true competitor to Microsoft Corporation's (NASDAQ: MSFT) Office juggernaut, it is making headway.

The "software as a service" camp is doing nothing but speeding up, as small and large businesses would like to offload expensive software installations and just use the Internet as a vehicle for getting things done across boundaries and time zones. Microsoft, though, is not capitulating just yet.

Although Microsoft Corp. (NASDAQ: MSFT) has much of the business world wrapped around at least some of its software, the largest software company in the world is mostly known for its consumer products. Names like Windows, Zune, Windows Mobile, Sidekick, and Xbox are household terms (well, in gadget households perhaps).

Still, with all those names, why hasn't Microsoft formed some kind of overall consumer ecosystem so that all these products fit, work, and play together seamlessly?

Yahoo! Inc. (NASDAQ: YHOO) made the decision to use competitor Microsoft Corp.'s (NASDAQ: MSFT) Bing search technology soon to power the internet searches across its vast empire. That doesn't mean that Yahoo! still won't compete with Microsoft aggressively. After all, Yahoo!'s agreement with Microsoft is only to use the software giant's Bing search technology in the back end -- not in the customer's face.

Yahoo!'s Prabhakar Raghavan indicated that "It is our belief that the battle has moved beyond the back end ... what we do with it, how we paint it, how we render it, that's entirely up to us." This confuses the issue a bit but what he is saying is that Yahoo! will use Microsoft's technology, but will still heavily compete with the company in terms of customer-facing search market share. The thoughts of a Microsoft-Yahoo! full-frontal assault on Google Inc.'s (NASDAQ: GOOG) market-leading share won't really be positioned that way after all.

Google Inc. (NASDAQ: GOOG) has grown plenty of enemies in the past five years due to its unprecedented growth and customer uptake. Put simply, Google produces products people want to use, and as such it has grown to a fantastic size (in product use and revenue).

Google's audacity in wanting to scan in books and make them available to anyone in digital form, though, has been a thorn in the company's side.

Microsoft Corporation (NASDAQ: MSFT) was hung out to dry back in 2002 when the U.S. government slapped it with all kinds of fines and limits based on its anti-competitive behavior in the PC market. Although Microsoft financially overcame all that was set against it, the company has not really wilted in terms of its software products or even the use of its market-leading internet browser, Internet Explorer.

When Google, Inc. (NASDAQ: GOOG) released Google Docs a few years back, it may have scared software competitor Microsoft Corp. (NASDAQ: MSFT) just a bit. Office is one of Microsoft's largest cash cows and the company knows many previous software applications are being ported to jut the web -- not to your local PC. Google's entire existence is based on this. So, when will we see Microsoft Office for the web?

Microsoft Corporation (NASDAQ: MSFT) has hit an initial home run with its Bing "decision engine" that it has been advertising like crazy. But, with over 60% of the search market share in the U.S., should leader Google, Inc. (NASDAQ: GOOG) be worried about the newer competitor?

Does Microsoft Corporation (NASDAQ: MSFT) really continue to believe that it can grab internet search market share away from giants like Google, Inc. (NASDAQ: GOOG) and Yahoo!, Inc. (NASDAQ: YHOO)? The software company, which time and time again has said it intends to continue competing in the race for search market share, is about to release its latest effort -- Bing.

Microsoft Corporation (NASDAQ: MSFT) took many of the chin when it released Windows Vista over two years ago when it received as many panning reviews as possible for the world's largest software company. Since then, the software behemoth has been planning a Vista successor that is leaner, safer, and doesn't require the latest PC to provide optimum performance.

That being said, the rumor is that the new Windows 7 will be available for sale and on new PCs sometime at the beginning of 2010. According to one of Microsoft's chief Windows engineering leads, the world could see Windows 7 sometime this summer.

Verizon Wireless, a division of Verizon Communications, Inc. (NYSE: VZ), and Microsoft Corporation (NASDAQ: MSFT) may be partnering soon to take on the Apple, Inc. (NASDAQ: AAPL) iPhone. The iPhone, which has re-defined the mobile handset and has racked up huge sales worldwide in the 22 months in existence, needs a strong competitor. So far, all the iPhone "killers" have been anything but.

Microsoft Corporation (NASDAQ: MSFT) is putting the final touches on Windows 7, and by all accounts it will be Microsoft's best operating system product in nearly a decade when it's released. But that's not the only cash cow the software giant has -- its Office franchise is hugely profitable as well. Could that piece of its business ever be in jeopardy, though?

The OpenOffice.org full software productivity suite is, in an odd way, Microsoft Office's largest competitor. Largest in that it's unknown in almost every corporate circle I've seen, and significant in that it provides -- for free -- almost everything the costly Microsoft Office does.

If IBM Corp. (NYSE: IBM) really does go ahead and buy Sun Microsystems (NASDAQ: JAVA) for a cool $6.5 billion or more, the two former adversaries could be joined into a powerful computing combination. One of its -- no, its largest competitor would be: Microsoft Corp. (NASDAQ: MSFT). With many powerful players challenging Microsoft's dominance these days (Google in the consumer space), here's another one. That is, if the merger speculation turns out to be true.

Google Inc.'s (NASDAQ: GOOG) Android operating system was publicly marketed as a mobile operating system when it was released. The first wireless handset it was available on was the G1 smartphone offered by the fourth-largest U.S. wireless carrier, T-Mobile USA. But, you can't keep an open-source operating system developed by the Google behemoth down to just one platform.

Microsoft Corp. (NASDAQ: MSFT) has had troubles recently trying to convince customers to use its Windows Live services over the competitor's products, namely those produced by Google, Inc. (NASDAQ: GOOG). Although Windows Live is a fine collection of services, Google gets all the glory just because of its name and because its products are no-frills and work very well. Microsoft's software doesn't exactly have the same reputation, unfortunately.

But Windows Live just got way better. Microsoft, as of late, has opened itself up to collaborating with other services, websites and partners to allow customers a "one-stop shop" for doing everything in one place. AOL did this recently by allowing all the popular email services (Yahoo! Mail, Hotmail, Google's Gmail) to be accessed from its custom homepage.

As these companies are now figuring out, the world does not revolve around just themselves. Customers use services from multiple companies and sources and making it all accessible under one brand or roof is now what all companies are trying to make available to their customers. Microsoft's attempt here with Windows Live includes integration of popular social networking sites (Facebook, MySpace) as well as instant messaging and email from many popular sources.

This is a great move from Microsoft. Instead of forcing customers to play in its own sandbox, the software giant has figured out that perhaps more of its customers will come to it and stay there if it offers a connection to non-Microsoft services and products that complement its own (not compete).

This post is part of a feature on companies and products that our bloggers think are in need of a makeover. See all 26.

When Microsoft Corp. (NASDAQ: MSFT) released its Windows Vista operating system product almost two years ago, the market was initially excited. That excitement turned to boring indifference as customers, both business and consumer, realized that this was just another update to Windows. Nothing revolutionary, or even evolutionary (in many minds). The problem was this: Windows Vista was a huge change under the hood, but where its users interact with it, it seems like a boring reinvention of an operating system from half a decade ago.

But Microsoft doesn't just make operating systems. It's into the office productivity business (Microsoft Office, anyone), it's big into the mobile business (Windows Mobile), and it's tried desperately to compete with Google Inc. (NASDAQ: GOOG) in the web search advertising business (which has largely failed). So, the company, which continues to make a ton of cash every quarter by selling Windows on all those global PCs that are sold, has no debt and a ton of cash under the mattress. It's still a boring company with a business model that's being made rapidly outdated by the internet and web-based competitors. Should it take its cash, return it to shareholders, and close up shop? Though this was suggested of Apple Inc. (NASDAQ: AAPL) some time back, that company roared back (maybe you've heard). Can Microsoft?