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Competition within the technology industry is strong. Tech giants such as Apple (AAPL), Amazon (AMZN), Google (GOOG), Hewlett-Packard (HPQ), Microsoft (MSFT) and Research in Motion (RIMM) are continuously innovating and introducing new products and services relevant to consumers. Analysts are very positive that Apple remains the leader in the tablet market and it will continue to increase its revenue over the years. Analysts predicted last week that Apple would be the first $1 trillion company.

Google will continue its dominance in the online advertising market. The company will emerge as a strong competitor in mobile devices. Google recently revealed its Project Glass, a revolutionary hands-free mobile device everyone is talking about. According to analysts, Google will remain profitable and there is a possibility that it will surpass Apple if the Project Glass becomes successful. Apple and Google are obviously racing to lead the mobile technology market.

Jim Cramer on CNBC's "Mad Money" projected that Microsoft and Intel's stock price will rise this year. According to him, Intel ($28 per share) and Microsoft ($31 per share) are two of the cheapest and strongest stocks in the market and have plenty of momentum to grow. He estimated that Intel's growth would be 25% while 50% growth for Microsoft. He also emphasized that both companies pay good dividends. Microsoft offers 2.3% yield while Intel pays higher yield at 3%. I believe that Microsoft and Intel stocks are good investments.

Why is Microsoft a strong buy for 2012? Since 2003, Microsoft has been the world's largest software company. Its total software revenue from sale of licenses, maintenance, subscription and support last year was $54.3 billion or 80.5% in total revenue share-$5 billion revenue or 10.6% increase compared to its 2010 revenue. The current market value of the company is more than $265 billion. During the 52-week range, Microsoft's stock price increased from $23 to $32. The company has around $109 billion in total assets, and $53 billion in cash. Its assets and cash on hand are greater than its total liabilities of around $29 billion. These figures show that Microsoft is financially strong to withstand a global economic crisis. Furthermore, the company has been paying dividends to its shareholders since 2002.

Microsoft reported more than $17 billion dollars revenue for the first quarter of 2012- 7% higher compared to last year's first quarter revenue. According to Microsoft's chief financial officer Peter Klein, the company is in the position to enjoy future growth due to strong consumer demand for its products and services. Its Microsoft Business Division, Windows and Windows Live Division as well as the Server & Tools segment recorded revenue growths of 8%, 2% and 10% respectively. Microsoft expects higher EPS growth next quarter.

Looking forward, I believe that Microsoft's stock price will definitely rise based on the company's sound fundamentals and past financial results. I am also positive that the company will have a strong hold on the cloud market because its cloud products are highly competitive in price and performance. The new version of the Windows Phone Operating System will also click to consumers because it offers a more improved integration with Bing, Xbox 30, LIVE and Office 365. Xbox 360 will remain the top game console in the United States. The company sold more than 426 thousand units in February this year, accumulating more than 40% share on the console market for the past 12 months-beating the Sony PlayStation 3 and the Nintendo Wii. Xbox 360 will continue to generate revenue for the company within the next coming years.

Microsoft plans to release more than 70 Kinect games for the holiday season. Microsoft's Xbox live has 35 million consumers and it is expected to increase as a result of its partnership agreements with 40 companies to become its Xbox live video partners to provide new and unique television experience. These partnerships will surely boost the company's profitability. Furthermore, Microsoft's $8.5 billion acquisition of Skype on October 2011 was a good investment and strategic move for the company to ensure its strong hold on the internet telephony business. Skype has more than 65 million users worldwide. The average time users spend on Skype video calls is 300 million minutes per day while spending only 30 million minutes per day on regular phones. Microsoft's target is to increase the number of users to 1 billion per day by integrating its products to Skype. Since 2002, Microsoft's financial investments have been very successful. In 2011, the company's investment was worth $24.64 billion and its cash return on invested capital (CROIC) was 90.72%. I believe that the current 9% growth of Microsoft's Entertainment & Devices business sector will double by the end of 2012.

On February 2012, results of the comScore qSearch analysis on the search market place in the United States revealed that Google Sites remains dominant with 66.4% market share, Microsoft Sites ranked second with 15.3% while Yahoo! Sites was third place with 13.8% market share. Microsoft reported that it is concentrating on improving its search business financial performance. In 2010, Microsoft and Yahoo! entered a Search Alliance to compete with Google. The deal did not provide significant revenue for both companies last year but still, Microsoft reported an almost 21% revenue increase in online advertising. Microsoft is working closely with Yahoo! to improve the revenue per search by solving the monetization challenges related to the combine ad platform of the companies.

Microsoft is set to introduce the new Windows 8 operating system, new version of Microsoft office and the Ultrabook Touch. According to analyst Rick Sherlund, the Ultrabook Touch is the "next big thing" and it will push the company forward. Sherlund predicted that 2013 would be a "pretty good" year for Microsoft.

I strongly agree that the Ultrabook Touch will be the next hit among consumers. A tablet integrated with an office program is definitely the best choice for consumers especially those who are hoping for a device with all the features available in a tablet and a notebook.

For the past ten years, Microsoft's strong leadership has been able to create profits for the company even during tough economic conditions. Microsoft stock is definitely a good investment this year.

Source: Microsoft Will Jet Higher From Skype Integration, E&D Division