How will this whole Google vs. Microsoft thing turn out? Peter Wilson, a Microsoft veteran who went on to serve as site director for Google's Kirkland office before leaving in the spring, offered his take on the battle during a presentation at Ignite Seattle last night. See the video above, and read on for a summary of his key assertions.

Google vs. Microsoft is a proxy for new vs. old in software application development, deployment and payment. It's also the first big battle between Microsoft's proprietary software model and a company such as Google, which is the "first super-scale company built on open-source."

Cloud computing will prevail. When the bandwidth and reliability of your network connection equals that of your monitor cable, there's no financial reason to have a PC on your desktop anymore.

Google believes the amount of money they make is proportionate to the number of people online. Google believes it can monetize that traffic better than anyone else. They're great at leveraging the community.

Microsoft believes in developing and "restrictively licensing" a platform to generate revenue. Believes in "devaluing their partners." Builds an ecosystem instead of a community, "which means they get a bunch of people around them, and then they kind of suck the value to them from the work those people do."

Microsoft realized too late that search was a platform for making money, now doing unnatural actions to compete. Microsoft is all about controlling the online platform with the browser. Google doesn't care about the platform, just wants to make sure it's open, so that its content and apps can flow through.

Creates an asymmetrical competition.

Google's creation of an operating system can get Microsoft's OS customers to demand a cheaper product. Google has realized it doesn't need to compete on Microsoft's terms. Even though Chrome browser has 3% market share, Google is winning because web apps run better on every browser, because of its leadership.

Microsoft should "stop with the client-server stuff." They should be building a small client operating system with a fast browser that you could plug into the public Internet without having to buy antivirus software. "If anybody knows Sinofsky, tell him that's what he should do."

Google is winning, and it should avoid messing that up. Google should use its position to help content, news and music providers "to help these businesses build a safe place where they can be fairly rewarded on the web."

Can both companies win? No. Both companies have high margins, and their stock prices and employee compensation rely on that. Both companies clearly in each other's cross hairs.

Given the five-minute Ignite format, you can only squeeze so much in, as Wilson noted on Twitter this morning. But going into the presentation, I was thinking we might hear something a little more critical of both companies. For example, the long-term challenges Google could face over privacy concerns, and the potential ceiling for primarily ad-funded business models.

That said, Wilson clearly has a strong point of view, and an interesting perspective, especially given his experience inside both companies. Looking forward to hearing what everyone thinks about what he had to say.