"Google vs Microsoft. Which one is worthy of IT's trust?Google is an information harvesting Giant. Microsoft is the "evil empire". Which one do you trust your technology to?"
...kind of a silly, oversimplified question from Focus.com but it's in my wheelhouse so I let it rip...
You've asked two questions so I'll provide 2 answers.
1. Both
Both firms are professionally run organizations with thousands of clients and intelligent, caring employees. Microsoft and Google are two of the most important companies our world has seen to date. They'll be in text books (ebooks?) right next to Ford and General Electric. For all the nonsense in the press, both firms continue to post outstanding numbers.
2. Both again, but now it gets more complicated.
Microsoft is now about 32 years old. They are a mature, healthy on-premises software products company. They continue to compete aggressively across an impressive range of technologies. Microsoft likely competes against as many other technology companies as any firm on earth. Like it or not, the firm is going to fight for every dollar. Microsoft's profits are driven by Windows and Office. This client/server product-based business model created our world's richest man. It will continue to generate billions of dollars in revenues and profits for most of the next decade.
Google is roughly 13 years old. They are a mature, healthy Internet services company. They also compete aggressively across an impressive range of technologies. The critical difference between the two firms is what lay at the foundation of their business models. One is a software products company, one is an Internet company. I'm not talking about what their marketing says - I'm talking about how they actually make money. So what? Well, the "so what" is the fact that the Internet is the most disruptive innovation in human history - rivaled only by the printing press and the plow. It's difficult to really get a sense of the moment in history we're experiencing first hand. As the leading Internet company, Google doesn't really have to be run all that well and they'll continue to make money hand over fist - that being said, the company is run extremely well and continues to flex its influence across a huge range of industries.
I'll take my explanation above to a specific one-on-one case that I think you may be referring to in your question: Google Apps vs. BPOS
We'll start with Google. Today we take Google.com for granted but it is an extremely impressive SaaS application. The amount of data Google indexes, organizes and distributes globally on-demand is amazing. Google.com was one of the first globally available SaaS applications and certainly the most successful. In the quest to teach machines to understand content created by man, Google stumbled across AdWords - these two SaaS applications are a seriously powerful team. To enable these SaaS applications to be immediately available to anyone anywhere in the world, Google built a custom software and hardware infrastructure and has continued to invest heavily in this asset ... about $9,000,000,000 over the past 5 years or so. This is important because Google's other Internet services run on the same infrastructure - Google Apps for Business has much more in common with Google.com than it does Exchange Server or SharePoint. This is how Google is able to roll out new features roughly every 2 weeks to millions of users, this is how they're able to provide services at a fraction of the cost of the legacy options, this is how they're able to provide dozens of services as part of Google Apps, and this is how Gmail is able to run at 99.984% uptime.
Now let's look at Microsoft. You noticed I used BPOS above instead of Office 365, why? Well, because Office 365 hasn't been released yet - it's not available. BPOS runs on the 2007 server products and while client/server itself was designed for a world without the Internet even these 2007 versions were designed for a world without the iPhone, Android, or the iPad. BPOS has nothing in common with Bing and everything in common with Exchange Server. Office 365 is built on the 2010 line of server products which are quickly becoming outdated themselves - the 3 year on-premises upgrade cycle just doesn't fit into the reality of today's technology environment - we move at Internet speed now. BPOS is more expensive than Google Apps and it only includes 4 services vs dozens from Apps. BPOS and Office 365 both require on-premises investments like Communications Server for BPOS and a required upgrade to Lync Server for Office 365. Is BPOS or Office 365 a smarter choice than their on-premises counter parts? Absolutely but that's hardly the measure that should be utilized - it's like comparing your car to your horse instead of the other cars. Just because Microsoft paints a racing stripe on client/server products and boards them for you doesn't turn that horse into a car.
Google makes money with Internet services, they built a cloud and then decided they could run other SaaS applications on it along with Google.com. Microsoft makes money with client/server software products, they built data centers to host those products and called it a cloud. One's not inherently right or wrong - "cloud" is the new "light". Yes there is light ice cream but I doubt your personal trainer recommends it in any quantity. It's not Microsoft vs Google, it's business built on the Internet vs business built on client/server.
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