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Android drives Google past Microsoft as search giant becomes world's second most valuable tech firm

Internet search behemoth Google has surpassed computing giant Microsoft to become the second most valuable publicly-traded technology company in the world.

Google rose 1 per cent yesterday, closing trading in New York with a share worth of $761.78 (£471.34) translating into a total market capitalisation value of nearly $250 billion (around £155bn).

Iconic software manufacturer Microsoft, by way of contrast, fell around 1 per cent in the markets on Monday, closing out business at $29.49 (£18.25) with a lesser valuation of $247.2 billion (£152.9bn)

Far from an arbitrary game of musical chairs at the top of the tech world, Google's ascent to the number two financial position is another sure sign that the industry continues to trend away from traditional hardware and software sales, with growth now being powered by online advertising, and the sector in general dominated by mobile technology.

(opens in new tab)Google's mobile operating system, Android, dominates its market (opens in new tab)and is installed on nearly two-thirds of all smartphones, boasting year-on-year deployment growth of some 43 per cent. Rival Microsoft and its Windows-branded mobile OS is nearer the bottom of the league table with just a 2.7 per cent market share.

Likewise, Google dominates the search industry, controlling two-thirds of the world's web query traffic, compared to the 16 per cent captured by Microsoft's Bing search platform. As a result of its gargantuan online reach, Google is on track to to displace Facebook as America's largest outlet of display advertising, according to reports by EMarketer.

Google will also remain top dog for mobile ads in the US, according to projections by the market research firm.

Apple is the world's most valuable company, (opens in new tab) with a market capitalisation value of over $618.1 billion (£382.4bn) – more than nearest rivals Google and Microsoft combined.

Microsoft will no doubt be hoping for a boost in the near future, with 25 October set to see the launch of its latest operating system, the tablet-friendly Windows 8. A few days later – some sources are citing 29 October – the firm will debut a new mobile OS, Windows Phone 8, which is set to feature on key autumn handsets like the Nokia Lumia 920 (opens in new tab) and HTC 8X. (opens in new tab)

For more on the big bucks driving the technology industry, see David Cardinal's 'Tech Deathmatch: Amazon vs Apple vs Google vs Microsoft.' (opens in new tab)

James is a freelance editor, journalist, and writer with 10+ years experience in digital media, SEO and news writing. He has produced content on a number of Future sites, including TechRadar, ITProPortal, Tom's Guide, and T3, and was Senior Staff Writer at ITProPortal.