Google and Microsoft are cultivating new revenue streams in non-advertising products. Some services that sit in the cloud aim to offset slowing online ad sales.
Enterprise applications have become a positive revenue stream for Google, the company's Chief Business Officer Nikesh Arora said during the Q2 2013 earnings call Thursday.
"That's another great revenue stream for Google," Arora said. "It comprises productivity apps like Docs and Gmail, as well as our cloud infrastructure."
Arora estimates that more than half of the Fortune 500 companies use a paid enterprise product from Google, and five million businesses use its productivity apps. Federal Express -- which built its store locator in Google Maps -- and SnapChat, which runs the Google Cloud Infrastructure, became new customers in Q2. LinkedIn uses the Google Search Appliance, and HP resells Google Apps to combine the cloud platform with HP hardware.
In June, Microsoft released the public preview of Windows 8.1 that combines desktop and cloud services. It offers new features and improvements like personalization, search, built-in app and cloud connectivity. Windows 8.1 will become a free update to existing Windows 8 users, made available to OEMs in August.
Microsoft, which has been building an enterprise cloud business for years, closed its fiscal year with $22.4 billion in revenue. During its earnings call Thursday, the company said it added 25% more enterprise customers this quarter. Now more than 50% of the Fortune 500 companies rely on Windows Azure.