4 ms·

The same argument applies to any company with large amounts of cash in the bank: Google, Apple, Oracle. If we're not asking why Apple doesn't do that, then we s

by kjksf 15y ago

The same argument applies to any company with large amounts of cash in the bank: Google, Apple, Oracle. If we're not asking why Apple doesn't do that, then we shouldn't be asking why Microsoft doesn't do that. One obvious problem is management. Microsoft (and pretty much any other successful company) gets majority of its profits from a very small number of highly profitable products. It's hard to manage several businesses. Imagine how hard it would be to manage 8500 independent business. Or integrate them meaningfully into Microsoft (at that scale, they would have to integrate a whole startup as quickly as they integrate a single engineer today, i.e. several per day). They would also need hundreds of people involved in picking the startups and making the deals. For Microsoft, a company/product that does 10 million/year, even if it was acquired for 1 million, will not make a difference. They need billion dolar products. So the question is: if they invested in 8500 startups, would Skype be one of them? If not, they still would have to buy Skype.

thematt 15y ago
Imagine how hard it would be to manage 8500 independent business. Why would they need to manage 8500 businesses? That's probably the last thing they or the startups want. Give the startup the resources and let them do the rest. So the question is: if they invested in 8500 startups, would Skype be one of them? If not, they still would have to buy Skype. Microsoft has spent billions on acquisitions and marketing that turned out to be a complete failure. Betting on some startups is probably a better gamble. Microsoft can concentrate that bet on a single business for a huge sum (like Skype) or they can spread it out among thousands of businesses with smaller amounts of capital. Realistically, given the money that they have, Microsoft can probably do both.
nicoslepicos 15y ago
Yup - but their management would only have to be minimal. More than anything, the mindshare, and the developers that they would have using their tools, and thinking about Microsoft technology more frequently could be worth it even if they don't get quite the billion dollar returns they're looking for.
forgottenpaswrd 15y ago
"The same argument applies to any company with large amounts of cash in the bank: Google, Apple, Oracle. If we're not asking why Apple doesn't do that" Well, Google IS doing that. It is not only the google summer of code when they could know about young and fresh people they can hire for cheap if they are good(with a proven real case). It is about companies like now "google earth" that later become "google maps", "google docs","gmail", "blogger", "google voice", the company then "panoramio" and know the photos is gearth and so and so. Those companies were in the millions(in son cases tens of) for acquisition cost.
Create 15y ago
One obvious problem is management. Nope. Contrary to its PR image, MSFT is not a software company, not in a full sense. They are more into management (yes, this is an euphemism). If you look at their core products, they are almost all essentially acquired or "copied". (DOS-, NT-VMS, IE-Spyglass, DirectX was essentially NV1 etc.) They are successful at "selling" and doing DM with influential people. Very few people actually go out and buy their products, which would be true sign of best fulfilling a need in the demand-offer market sense. But most of their cash cows are shipped OEM or are centrally purchased and shoved down the corporate/gvt-al echelons. Others are tied into vendor lockin and the network effect. Should MSFT be a real software company, it should have no problem competing with Linux/Android/Java/LO etc. offering superior products without any dirty legalese tricks.

by kjksf 15y ago

thematt 15y ago

Imagine how hard it would be to manage 8500 independent business. Why would they need to manage 8500 businesses? That's probably the last thing they or the startups want. Give the startup the resources and let them do the rest. So the question is: if they invested in 8500 startups, would Skype be one of them? If not, they still would have to buy Skype. Microsoft has spent billions on acquisitions and marketing that turned out to be a complete failure. Betting on some startups is probably a better gamble. Microsoft can concentrate that bet on a single business for a huge sum (like Skype) or they can spread it out among thousands of businesses with smaller amounts of capital. Realistically, given the money that they have, Microsoft can probably do both.

nicoslepicos 15y ago

Yup - but their management would only have to be minimal. More than anything, the mindshare, and the developers that they would have using their tools, and thinking about Microsoft technology more frequently could be worth it even if they don't get quite the billion dollar returns they're looking for.

forgottenpaswrd 15y ago

"The same argument applies to any company with large amounts of cash in the bank: Google, Apple, Oracle. If we're not asking why Apple doesn't do that" Well, Google IS doing that. It is not only the google summer of code when they could know about young and fresh people they can hire for cheap if they are good(with a proven real case). It is about companies like now "google earth" that later become "google maps", "google docs","gmail", "blogger", "google voice", the company then "panoramio" and know the photos is gearth and so and so. Those companies were in the millions(in son cases tens of) for acquisition cost.

Create 15y ago

One obvious problem is management. Nope. Contrary to its PR image, MSFT is not a software company, not in a full sense. They are more into management (yes, this is an euphemism). If you look at their core products, they are almost all essentially acquired or "copied". (DOS-, NT-VMS, IE-Spyglass, DirectX was essentially NV1 etc.) They are successful at "selling" and doing DM with influential people. Very few people actually go out and buy their products, which would be true sign of best fulfilling a need in the demand-offer market sense. But most of their cash cows are shipped OEM or are centrally purchased and shoved down the corporate/gvt-al echelons. Others are tied into vendor lockin and the network effect. Should MSFT be a real software company, it should have no problem competing with Linux/Android/Java/LO etc. offering superior products without any dirty legalese tricks.