9 ms·

Microsoft Mission Impossible

49 points by coloneltcb 13y ago

bigben 13y ago
I would say their enterprise health isn't terrible and might even be growing. But they're getting trounced in the consumer market so handily, and by so many other competitors, that it seems impossible they'll see ever see meaningful growth there. A lot of that is because of the legacy freight they're forced to carry wrt their PC and enterprise concerns...and because of the memories of everyone who had to deal with crappy MS systems in the 90's and early 00's. I've often said it wouldn't be a terrible thing for MS to spin off a consumer division. It could integrate fully into MS's current services, but it would be free of the psychic burden of the "Microsoft" brand, with all of the stodgy uncoolness that that entails. Not to mention a separate company would be free to move more quickly in the face of the rapidly changing consumer market. However, the board would probably consider this to be a "hail mary" play. I will be very interested in seeing how the new CEO handles the consumer side.
adamnemecek 13y ago
Partial blogger says something partial, more news at 11.
coldcode 13y ago
I'd take the job on for about 5 seconds before I pulled my golden ripcord. This is a job that no one likely can succeed at.
- adventured 13y ago
  There are two paths to success, that are very different. 1) I'd argue that just maintaining the profit level they have now, over the next decade, would be a success given the situation. 2) Breaking the company into pieces, and letting new growth thrive from a smaller base, and letting old pieces die off if that's the way it's going to be (eg Windows consumer desktop). There's a lot of precedence for this sort of maneuver outside of tech, for stodgy old companies with mixtures of slow/no and faster growth businesses. The pieces could be seeded with tremendous amounts of cash to jump start them. I think #2 is very unlikely given the Microsoft culture, however I think that's exactly what should happen.
- venomsnake 13y ago
  And I would take the job for $1 yearly and turn the company around. No golden parachutes needed. MS has so many resources and good people that it is almost impossible with the right vision to fail on delivering.
grogenaut 13y ago
Summary: Steve Jobs Steve Jobs Steve Jobs
bane 13y ago
One of the really surprising things about Microsoft is that despite all the caustic internal politics, CEO antics, missteps, misfires, a business model designed to extract maximum money from everybody, and even questionable development and design practices, on occasion really great software (and hardware) comes out of there. World class, amazing, top of the industry with no true peers. For example, despite all of the good ideas and theory and philosophy, open source, after 13 years of effort, (while there's definitely been good work done in the area) has yet to produce an office suite that's at least as good as MS-Office is in all areas. I'm sure the MS-Office codebase is a horrible mess, but the end user bits are good enough for nearly all of the weird edge-cases that 99% of users want and 99% of users can learn to use it to some level of effectiveness in a couple afternoons. That's amazing.
- quesera 13y ago
  I'd be interested to hear what your other examples are, but that doesn't surprise me at all. If OpenOffice (etc) ever had comparable staffing (quantity and variety, not even questioning quality) that MSOffice has had for 15-20 years, I'd expect more comparable results.
  - wslh 13y ago
    if openoffice... It does not work that way since neither Apple nor Google can beat Microsoft Office with big budgets. Beyond talking about the technical aspects of Office what also matters is the marketing/sales machine. For example, I was present in negotiations between Microsoft and big (non US) state agencies, and you know what? The Microsoft guy was surely at more than 6 degress in the Microsoft organizational chart to Bill Gates but he could negotiate as if he was Bill Gates, he had that freedom. The agency was pushing open source and the guy said something like: the Office $ XXX price does not work for you? What about $ 5 per license?
  - jmcqk6 13y ago
    >If OpenOffice (etc) ever had comparable staffing (quantity and variety, not even questioning quality) that MSOffice has had for 15-20 years, I'd expect more comparable results. Isn't that sort of the point, at least from their perspective?
clarky07 13y ago
I think the people who say Microsoft has been a huge failure for the last decade should take a better look at the numbers that matter. The stock price doesn't matter. In 2000, we were at the top of the tech bubble. Bubble means valuations were stupid. The story talks about 2000 report with 19.3 billion from windows and 23 billion total revenue. On the other hand, Microsoft made 19.9 billion in revenue just last quarter, with 5 Billion in net profit. 6 Billion operating income because of the surface writeoff. Are other companies doing better? Yes. Could Microsoft have done better? Yes. Have they done badly? Not at all. They have grown revenues and profits at huge and absurd levels over several different divisions. They are also not going to die any time soon, and I don't think there are too many options to take a company this big private.
- adamnemecek 13y ago
  I think that the main reason for this is that even thought the numbers are comparable in absolute terms, the market has grown in the mean time and the same number does not seem as impressive anymore.
- programminggeek 13y ago
  Microsoft has done quite well financially, but where they look bad is when you see how much Google, Apple, Facebook, Amazon, etc. have grown in the same period. One thing I learned in business school is the measure of a CEO is not whether or not they did a good job, but rather if they did a better job than someone else in the same position. It's hard to look at Microsoft in the last 10 years and think that they have done as well as they could.
  - throwawaykf 13y ago
    Google, Apple, Facebook, Amazon? That is a woefully inadequate list of competitors. Here's a slightly more (but by no means fully) complete list, including some companies that are no longer around: Oracle Salesforce Mozilla Sony Nintendo Samsung Blackberry IBM Heroku Rackspace Sun Novell Red Hat Jetbrains Not to mention, open source projects like Apache, Linux, Open Office, etc that attempt to commoditize their products. That is an incredibly huge list by any standard, and many on that list are giants themselves. Now, given that Microsoft has competed, on average, successfully against all these rivals, many of whom give away competing products for free, would you still consider their lack of success against a select few to be a huge shortcoming? (Edit: typos, fixes, adding more rivals as I think of them)
filestar 13y ago
The way to tell if a particular analysis of Microsoft's performance is baseless is the complete omission of the enterprise division in the analysis. Here are revenues by division: >Windows Division: 1.09 billion profit on $4.411 billion in revenue >Servers and Tools: $2.33 billion profit on $5.502 billion in revenue >Online Services: $372 million loss on $800 million in revenue >Business Division: $4.87 billion profit on $7.231 billion in revenue >Entertainment and Devices: $110 million loss on $1.915 billion in revenue The Server & Tools revenue grew 11% just in the last quarter. The writer may dismiss this with a counter argument, but not even acknowledging its presence shows that the writer is extremely shortsighted and only wants to talk about iPhones/iPads and casts doubts on the rest of the "analysis".
programminggeek 13y ago
The biggest problem with Microsoft after say 2005 was that it let things like Windows and Office drag it down to the point that if things competed with either, they were killed with fire. For example, look at what Ray Ozzie got built with Azure, or what J Allard did with the Xbox, Xbox 360, Zune, and Courier. Azure was in a prime spot to do what Amazon ended up doing - being the computing platform for the cloud. Instead, nobody at Microsoft wanted to listen to Ray because selling Windows and Office on PC's and servers is the thing that drives MSFT today. Thus, if it competed with either, it's not going to get the kind of respect it deserves. Look at where Microsoft is now on the consumer side. J Allard and his team were basically paving the way for Microsoft to make great consumer devices. Zune basically gave them Metro UI, Xbox 360 showed them how to do consumer hardware and supply chain management worldwide, and they were working on the Courier about the time the iPad hit. Microsoft did nothing with it and the iPad replaced literally millions of low end Windows laptops and netbooks. It took Microsoft something like 3 or 4 years to have an even competitive touch tablet experience with the Surface, and then it bundled desktop Office on a touch device. The iPhone debuted in like 2007 and Microsoft is still peddling a desktop mode Word Processor on a touch tablet as a good idea. The Surface launched without consulting the one team that had shipped tens of millions of hardware devices at Microsoft - the Xbox team and consequently built about 3 million too many Surface RT units which cost the company $900 million in losses. For as much as Microsoft is trying, and they really are trying, Windows and Office are as much of a curse as they are a blessing in the modern era of devices, services, and the cloud. Where they end up is anyone's guess, but all the people who seemed to "get it" at Microsoft the last 7 years or so basically got ran out of the company and I have no idea if the people who are still there really "get it" enough to compete with the likes of Samsung, Google, Sony, Amazon, and Apple. Also, remember when Microsoft was so terrified of Google owning search that they tried to buy Yahoo! for $45 billion? Imagine if that had gone through.
- yuhong 13y ago
  I mentioned before that the HTML export in Word/Excel 2013 is pretty much unchanged from 2003, complete with setting "Microsoft Internet Explorer 6 or later" in Web Options causing things like VML to be required that is not supported by IE10 anymore by default. You can see this if you draw a shape for example. I wrote an Ars Technica forum post on this.
maxander 13y ago
I find the "iPhone killed Microsoft" story to be unconvincing, despite its popularity. Yes, the iPhone is wildly successful beyond anything Microsoft has invented in the 21st century, but its a smartphone- whereas, as this article itself states, Microsoft was in the business of peddling a Windows/Office bundle. So its not as if Apple and Microsoft are competing on that front; no one buys an iPhone to replace their computer (or at least, I've yet to see a single example of such), much less their word processor. I mean, yes, Apple also handily outmanoeuvred Microsoft in those areas where they do compete, and has beaten back Microsoft's forays into mobile. But Microsoft's problems are much more mundane- office software became a commodity, and they've failed to produce a new OS that's a clear-cut improvement over Windows 95. One could imagine a Microsoft that found a way to meaningfully innovate purely on the good old PC platform and be successful without any of this mobile devices tomfoolery.
- skrebbel 13y ago
  > no one buys an iPhone to replace their computer No, but many people buy tablets to replace their computer and tablets happened, effectively, because the iPhone happened.
- wvenable 13y ago
  Ask a teenager if they'd rather give up their iPhone or their laptop; I guarantee they'll say laptop. The real problem for Microsoft and PC makers is that everyone has a PC and they don't need a new one. Whatever PC almost anyone has is now good enough. People are spending their money on the latest phones and tablets.
  - throwawaykf 13y ago
    True, a teenager would say that, but that's because teenagers are pretty shortsighted. Just wait until they get home and have to type up a school report. A few attempts on the touchscreen and even the most headstrong teenager will be ready to swap it for a laptop. And while it's true that the PC market is sort of saturated, the tablet market too will suffer the same fate. In the end the only thing that will continue to sell is services.
skrebbel 13y ago
I don't understand the fatalist mood in articles like these. Microsoft is still a very healthy company, and now they finally got that healthy competition. Competition is good for the market, it's good for us consumers. Hell, it might even be good for Microsoft in the long run. I'm admittedly a bit of a Microsoft fanboy, but I doubt that would've been the case if MS had still been the monopolist steam roller it once was. The current market has forced MS to truly innovate and to be a much more friendly company in general (evidenced by e.g. their broad contributions to open source these days). How can that be bad?
- michaelt 13y ago
  Many people model technology adoption as an S curve (with its differential, the adoption rate, resembling a normal distribution): https://www.google.co.uk/search?q=technology+curve&tbm=isch https://www.google.co.uk/search?q=technology+curve&tbm=isch They believe Microsoft's main revenue-generating technologies (Microsoft and Office) are at the 'mature' or 'stagnation' part of the curve. This is in line with this ten-year stock price graph: http://goo.gl/yyUwgr http://goo.gl/yyUwgr
adventured 13y ago
This article significantly understates the valuation picture of other tech companies during the dotcom bubble era. Cisco was briefly worth more than Microsoft during the dotcom bubble. They had a $557 billion market cap, which is completely left out of the chart. Intel peaked at $509 billion (August 2000) - also left out of the chart. Nortel was worth $283 billion at their peak. Lucent was worth $285 billion. AOL was worth $222 billion. Oracle and Sun were both worth over $200 billion. Yahoo was worth $140 billion. So they conveniently left out a cool $2.3 trillion or so in market cap among just a few other tech companies. Not to mention the various crazy valuations for companies worth tens of billions briefly.
allochthon 13y ago
A note of context about the author -- Jean-Louis Gassée was the man behind BeOS and was an executive at Apple in the 1980s.
timedoctor 13y ago
I have a completely contrarian view: They should stop trying to be a competitor to Google and Apple. Continue with Windows and Office, and continue to improve them. Get out of EVERYTHING else including all internet services and everything that is just a money-losing proposition. Then buy back as many shares as possible, keep buying back shares and if the shares get too expensive start paying billions and billions in dividends. Not every company is meant to be the next wave of the future, why not be content with how successful they are and be really good at it, continue to be great at it, and get out of everything else, banking as much money as they can in the process.
josephlord 13y ago
> In an earlier incarnation I saw Microsoft play legal hardball against anyone who tried to sell PCs with both Windows and another OS installed at the factory…) I know they played commercial hardball with people wanting to offer options other than MS operating systems. Does anyone have any information about them playing legal hardball (lawsuits or threats)?
- juhanima 13y ago
  How about this one? http://www.justice.gov/atr/cases/f3800/msjudgex.htm http://www.justice.gov/atr/cases/f3800/msjudgex.htm The relevant chapter is III.H.64: "An aspect of Microsoft's pricing behavior that, while not tending to prove monopoly power, is consistent with it is the fact that the firm charges different OEMs different prices for Windows, depending on the degree to which the individual OEMs comply with Microsoft's wishes. " EDIT: Replaced the link to the final version in stead of a proposal, added the quote EDIT2: Duh, I totally missed your point. Yes, they have resorted to also that tactics lately. Just a few high-profile cases. - Microsoft sues Barnes & Noble over patents - http://mashable.com/2011/03/21/microsoft-sues-barnes-noble/ http://mashable.com/2011/03/21/microsoft-sues-barnes-noble/ - Microsoft sues Salesforce - http://news.cnet.com/8301-13860_3-20005306-56.html http://news.cnet.com/8301-13860_3-20005306-56.html - Microsoft sues Motorola - http://www.techdirt.com/blog/wireless/articles/20101001/13562611251/microsoft-sues-motorola-for-patent-infringement-over-android.shtml http://www.techdirt.com/blog/wireless/articles/20101001/1356... IMHO especially the B&N case is telling. A very sad story.
  - josephlord 13y ago
    Thanks for that although I don't think it backs up the point I was questioning. Your inital quote confirms the commercial hardball that I never doubted and your later links confirm patent licensing demands against Android manufacturers although which isn't really about an "earlier incarnation [of MS]" and they have been making patent licensing deals with a great number of Android manufacturers so I'm not even sure I'd count it as hardball. Note that I am not a supporter of Microsoft and avoid their products largely because of the commercial hardball they played when they had monopoly power but the original article suggested that they played "legal hardball" with OEMs who wanted to ship devices (I interpreted as PC's) with additional operating systems rather than just MS ones. I had no recollection of this and was looking for a reference before I add it to the list of offences I believe MS to have committed. It is not implausible but it was a new claim and I wanted to understand it. I'm interested in understanding why you think the B&N case is so sad and telling. I haven't investigated the patents claimed but in principle the idea that MS requests fees for using it's patents isn't actually a problem for me.

49 points by coloneltcb 13y ago

I would say their enterprise health isn't terrible and might even be growing. But they're getting trounced in the consumer market so handily, and by so many other competitors, that it seems impossible they'll see ever see meaningful growth there. A lot of that is because of the legacy freight they're forced to carry wrt their PC and enterprise concerns...and because of the memories of everyone who had to deal with crappy MS systems in the 90's and early 00's. I've often said it wouldn't be a terrible thing for MS to spin off a consumer division. It could integrate fully into MS's current services, but it would be free of the psychic burden of the "Microsoft" brand, with all of the stodgy uncoolness that that entails. Not to mention a separate company would be free to move more quickly in the face of the rapidly changing consumer market. However, the board would probably consider this to be a "hail mary" play. I will be very interested in seeing how the new CEO handles the consumer side.

adamnemecek 13y ago

Partial blogger says something partial, more news at 11.

coldcode 13y ago

I'd take the job on for about 5 seconds before I pulled my golden ripcord. This is a job that no one likely can succeed at.

adventured 13y ago
There are two paths to success, that are very different. 1) I'd argue that just maintaining the profit level they have now, over the next decade, would be a success given the situation. 2) Breaking the company into pieces, and letting new growth thrive from a smaller base, and letting old pieces die off if that's the way it's going to be (eg Windows consumer desktop). There's a lot of precedence for this sort of maneuver outside of tech, for stodgy old companies with mixtures of slow/no and faster growth businesses. The pieces could be seeded with tremendous amounts of cash to jump start them. I think #2 is very unlikely given the Microsoft culture, however I think that's exactly what should happen.
venomsnake 13y ago
And I would take the job for $1 yearly and turn the company around. No golden parachutes needed. MS has so many resources and good people that it is almost impossible with the right vision to fail on delivering.

grogenaut 13y ago

Summary: Steve Jobs Steve Jobs Steve Jobs

bane 13y ago

One of the really surprising things about Microsoft is that despite all the caustic internal politics, CEO antics, missteps, misfires, a business model designed to extract maximum money from everybody, and even questionable development and design practices, on occasion really great software (and hardware) comes out of there. World class, amazing, top of the industry with no true peers. For example, despite all of the good ideas and theory and philosophy, open source, after 13 years of effort, (while there's definitely been good work done in the area) has yet to produce an office suite that's at least as good as MS-Office is in all areas. I'm sure the MS-Office codebase is a horrible mess, but the end user bits are good enough for nearly all of the weird edge-cases that 99% of users want and 99% of users can learn to use it to some level of effectiveness in a couple afternoons. That's amazing.

quesera 13y ago
I'd be interested to hear what your other examples are, but that doesn't surprise me at all. If OpenOffice (etc) ever had comparable staffing (quantity and variety, not even questioning quality) that MSOffice has had for 15-20 years, I'd expect more comparable results.
- wslh 13y ago
  if openoffice... It does not work that way since neither Apple nor Google can beat Microsoft Office with big budgets. Beyond talking about the technical aspects of Office what also matters is the marketing/sales machine. For example, I was present in negotiations between Microsoft and big (non US) state agencies, and you know what? The Microsoft guy was surely at more than 6 degress in the Microsoft organizational chart to Bill Gates but he could negotiate as if he was Bill Gates, he had that freedom. The agency was pushing open source and the guy said something like: the Office $ XXX price does not work for you? What about $ 5 per license?
- jmcqk6 13y ago
  >If OpenOffice (etc) ever had comparable staffing (quantity and variety, not even questioning quality) that MSOffice has had for 15-20 years, I'd expect more comparable results. Isn't that sort of the point, at least from their perspective?

clarky07 13y ago

I think the people who say Microsoft has been a huge failure for the last decade should take a better look at the numbers that matter. The stock price doesn't matter. In 2000, we were at the top of the tech bubble. Bubble means valuations were stupid. The story talks about 2000 report with 19.3 billion from windows and 23 billion total revenue. On the other hand, Microsoft made 19.9 billion in revenue just last quarter, with 5 Billion in net profit. 6 Billion operating income because of the surface writeoff. Are other companies doing better? Yes. Could Microsoft have done better? Yes. Have they done badly? Not at all. They have grown revenues and profits at huge and absurd levels over several different divisions. They are also not going to die any time soon, and I don't think there are too many options to take a company this big private.

adamnemecek 13y ago
I think that the main reason for this is that even thought the numbers are comparable in absolute terms, the market has grown in the mean time and the same number does not seem as impressive anymore.
programminggeek 13y ago
Microsoft has done quite well financially, but where they look bad is when you see how much Google, Apple, Facebook, Amazon, etc. have grown in the same period. One thing I learned in business school is the measure of a CEO is not whether or not they did a good job, but rather if they did a better job than someone else in the same position. It's hard to look at Microsoft in the last 10 years and think that they have done as well as they could.
- throwawaykf 13y ago
  Google, Apple, Facebook, Amazon? That is a woefully inadequate list of competitors. Here's a slightly more (but by no means fully) complete list, including some companies that are no longer around: Oracle Salesforce Mozilla Sony Nintendo Samsung Blackberry IBM Heroku Rackspace Sun Novell Red Hat Jetbrains Not to mention, open source projects like Apache, Linux, Open Office, etc that attempt to commoditize their products. That is an incredibly huge list by any standard, and many on that list are giants themselves. Now, given that Microsoft has competed, on average, successfully against all these rivals, many of whom give away competing products for free, would you still consider their lack of success against a select few to be a huge shortcoming? (Edit: typos, fixes, adding more rivals as I think of them)

filestar 13y ago

The way to tell if a particular analysis of Microsoft's performance is baseless is the complete omission of the enterprise division in the analysis. Here are revenues by division: >Windows Division: 1.09 billion profit on $4.411 billion in revenue >Servers and Tools: $2.33 billion profit on $5.502 billion in revenue >Online Services: $372 million loss on $800 million in revenue >Business Division: $4.87 billion profit on $7.231 billion in revenue >Entertainment and Devices: $110 million loss on $1.915 billion in revenue The Server & Tools revenue grew 11% just in the last quarter. The writer may dismiss this with a counter argument, but not even acknowledging its presence shows that the writer is extremely shortsighted and only wants to talk about iPhones/iPads and casts doubts on the rest of the "analysis".

programminggeek 13y ago

The biggest problem with Microsoft after say 2005 was that it let things like Windows and Office drag it down to the point that if things competed with either, they were killed with fire. For example, look at what Ray Ozzie got built with Azure, or what J Allard did with the Xbox, Xbox 360, Zune, and Courier. Azure was in a prime spot to do what Amazon ended up doing - being the computing platform for the cloud. Instead, nobody at Microsoft wanted to listen to Ray because selling Windows and Office on PC's and servers is the thing that drives MSFT today. Thus, if it competed with either, it's not going to get the kind of respect it deserves. Look at where Microsoft is now on the consumer side. J Allard and his team were basically paving the way for Microsoft to make great consumer devices. Zune basically gave them Metro UI, Xbox 360 showed them how to do consumer hardware and supply chain management worldwide, and they were working on the Courier about the time the iPad hit. Microsoft did nothing with it and the iPad replaced literally millions of low end Windows laptops and netbooks. It took Microsoft something like 3 or 4 years to have an even competitive touch tablet experience with the Surface, and then it bundled desktop Office on a touch device. The iPhone debuted in like 2007 and Microsoft is still peddling a desktop mode Word Processor on a touch tablet as a good idea. The Surface launched without consulting the one team that had shipped tens of millions of hardware devices at Microsoft - the Xbox team and consequently built about 3 million too many Surface RT units which cost the company $900 million in losses. For as much as Microsoft is trying, and they really are trying, Windows and Office are as much of a curse as they are a blessing in the modern era of devices, services, and the cloud. Where they end up is anyone's guess, but all the people who seemed to "get it" at Microsoft the last 7 years or so basically got ran out of the company and I have no idea if the people who are still there really "get it" enough to compete with the likes of Samsung, Google, Sony, Amazon, and Apple. Also, remember when Microsoft was so terrified of Google owning search that they tried to buy Yahoo! for $45 billion? Imagine if that had gone through.

yuhong 13y ago
I mentioned before that the HTML export in Word/Excel 2013 is pretty much unchanged from 2003, complete with setting "Microsoft Internet Explorer 6 or later" in Web Options causing things like VML to be required that is not supported by IE10 anymore by default. You can see this if you draw a shape for example. I wrote an Ars Technica forum post on this.

maxander 13y ago

I find the "iPhone killed Microsoft" story to be unconvincing, despite its popularity. Yes, the iPhone is wildly successful beyond anything Microsoft has invented in the 21st century, but its a smartphone- whereas, as this article itself states, Microsoft was in the business of peddling a Windows/Office bundle. So its not as if Apple and Microsoft are competing on that front; no one buys an iPhone to replace their computer (or at least, I've yet to see a single example of such), much less their word processor. I mean, yes, Apple also handily outmanoeuvred Microsoft in those areas where they do compete, and has beaten back Microsoft's forays into mobile. But Microsoft's problems are much more mundane- office software became a commodity, and they've failed to produce a new OS that's a clear-cut improvement over Windows 95. One could imagine a Microsoft that found a way to meaningfully innovate purely on the good old PC platform and be successful without any of this mobile devices tomfoolery.

skrebbel 13y ago
> no one buys an iPhone to replace their computer No, but many people buy tablets to replace their computer and tablets happened, effectively, because the iPhone happened.
wvenable 13y ago
Ask a teenager if they'd rather give up their iPhone or their laptop; I guarantee they'll say laptop. The real problem for Microsoft and PC makers is that everyone has a PC and they don't need a new one. Whatever PC almost anyone has is now good enough. People are spending their money on the latest phones and tablets.
- throwawaykf 13y ago
  True, a teenager would say that, but that's because teenagers are pretty shortsighted. Just wait until they get home and have to type up a school report. A few attempts on the touchscreen and even the most headstrong teenager will be ready to swap it for a laptop. And while it's true that the PC market is sort of saturated, the tablet market too will suffer the same fate. In the end the only thing that will continue to sell is services.

skrebbel 13y ago

I don't understand the fatalist mood in articles like these. Microsoft is still a very healthy company, and now they finally got that healthy competition. Competition is good for the market, it's good for us consumers. Hell, it might even be good for Microsoft in the long run. I'm admittedly a bit of a Microsoft fanboy, but I doubt that would've been the case if MS had still been the monopolist steam roller it once was. The current market has forced MS to truly innovate and to be a much more friendly company in general (evidenced by e.g. their broad contributions to open source these days). How can that be bad?

michaelt 13y ago
Many people model technology adoption as an S curve (with its differential, the adoption rate, resembling a normal distribution): https://www.google.co.uk/search?q=technology+curve&tbm=isch https://www.google.co.uk/search?q=technology+curve&tbm=isch They believe Microsoft's main revenue-generating technologies (Microsoft and Office) are at the 'mature' or 'stagnation' part of the curve. This is in line with this ten-year stock price graph: http://goo.gl/yyUwgr http://goo.gl/yyUwgr

adventured 13y ago

This article significantly understates the valuation picture of other tech companies during the dotcom bubble era. Cisco was briefly worth more than Microsoft during the dotcom bubble. They had a $557 billion market cap, which is completely left out of the chart. Intel peaked at $509 billion (August 2000) - also left out of the chart. Nortel was worth $283 billion at their peak. Lucent was worth $285 billion. AOL was worth $222 billion. Oracle and Sun were both worth over $200 billion. Yahoo was worth $140 billion. So they conveniently left out a cool $2.3 trillion or so in market cap among just a few other tech companies. Not to mention the various crazy valuations for companies worth tens of billions briefly.

allochthon 13y ago

A note of context about the author -- Jean-Louis Gassée was the man behind BeOS and was an executive at Apple in the 1980s.

timedoctor 13y ago

I have a completely contrarian view: They should stop trying to be a competitor to Google and Apple. Continue with Windows and Office, and continue to improve them. Get out of EVERYTHING else including all internet services and everything that is just a money-losing proposition. Then buy back as many shares as possible, keep buying back shares and if the shares get too expensive start paying billions and billions in dividends. Not every company is meant to be the next wave of the future, why not be content with how successful they are and be really good at it, continue to be great at it, and get out of everything else, banking as much money as they can in the process.

josephlord 13y ago

> In an earlier incarnation I saw Microsoft play legal hardball against anyone who tried to sell PCs with both Windows and another OS installed at the factory…) I know they played commercial hardball with people wanting to offer options other than MS operating systems. Does anyone have any information about them playing legal hardball (lawsuits or threats)?

juhanima 13y ago
How about this one? http://www.justice.gov/atr/cases/f3800/msjudgex.htm http://www.justice.gov/atr/cases/f3800/msjudgex.htm The relevant chapter is III.H.64: "An aspect of Microsoft's pricing behavior that, while not tending to prove monopoly power, is consistent with it is the fact that the firm charges different OEMs different prices for Windows, depending on the degree to which the individual OEMs comply with Microsoft's wishes. " EDIT: Replaced the link to the final version in stead of a proposal, added the quote EDIT2: Duh, I totally missed your point. Yes, they have resorted to also that tactics lately. Just a few high-profile cases. - Microsoft sues Barnes & Noble over patents - http://mashable.com/2011/03/21/microsoft-sues-barnes-noble/ http://mashable.com/2011/03/21/microsoft-sues-barnes-noble/ - Microsoft sues Salesforce - http://news.cnet.com/8301-13860_3-20005306-56.html http://news.cnet.com/8301-13860_3-20005306-56.html - Microsoft sues Motorola - http://www.techdirt.com/blog/wireless/articles/20101001/13562611251/microsoft-sues-motorola-for-patent-infringement-over-android.shtml http://www.techdirt.com/blog/wireless/articles/20101001/1356... IMHO especially the B&N case is telling. A very sad story.
- josephlord 13y ago
  Thanks for that although I don't think it backs up the point I was questioning. Your inital quote confirms the commercial hardball that I never doubted and your later links confirm patent licensing demands against Android manufacturers although which isn't really about an "earlier incarnation [of MS]" and they have been making patent licensing deals with a great number of Android manufacturers so I'm not even sure I'd count it as hardball. Note that I am not a supporter of Microsoft and avoid their products largely because of the commercial hardball they played when they had monopoly power but the original article suggested that they played "legal hardball" with OEMs who wanted to ship devices (I interpreted as PC's) with additional operating systems rather than just MS ones. I had no recollection of this and was looking for a reference before I add it to the list of offences I believe MS to have committed. It is not implausible but it was a new claim and I wanted to understand it. I'm interested in understanding why you think the B&N case is so sad and telling. I haven't investigated the patents claimed but in principle the idea that MS requests fees for using it's patents isn't actually a problem for me.