In a noteworthy break from tradition where tech giants often remain tight-lipped about each other’s competitive advantages, a surprising event unfolded between industry heavyweights Microsoft (NASDAQ:MSFT) and Google (NASDAQ:GOOGL). Microsoft made waves by issuing a report following the EU’s consultation earlier this year that focused on evaluating the competitive landscape within generative AI.
Microsoft informed the European Union (EU) in the report that Google is the only company with an edge in AI, boasting full AI vertical integration from chips to app stores. The company added that Google’s self-supplied AI chips and extensive proprietary data enhance its competitive advantage.
Competition In Generative AI
Microsoft reported that Google’s YouTube has a wide array of video content, and its Search Index enables it to train its large language model (LLM) Gemini. Moreover, Microsoft cited Google’s Google Assistant and Apple’s (AAPL) Siri voice assistants as an advantage for these companies.
In its report to the Commission, Microsoft highlighted that other companies are required to form partnerships in order to drive innovation and stay competitive.
It remains unclear why Microsoft released this report and if there was any ulterior motive behind it.
Is Microsoft a Buy, Sell, or Hold?
Analysts remain bullish about MSFT with a Strong Buy consensus rating based on 31 Buys and one Hold and Sell each. MSFT stock has surged by more than 60% over the past year and the average MSFT price target of $469.34 implies an upside potential of 10.4% at current levels.
