NYT: Microsoft Victim of the "Single-Era Conjecture"

May 18th, 2008 at 3:00 PM - News by John Martellaro

The worlds of science and technology have many famous conjectures, hypotheses and laws: Fermatis Last Theorem, the Riemann Hypothesis and Mooreis Law. Microsoft is struggling to confront what Randall Stross, writing for the New York Times, called the Single-Era Conjecture on Sunday. Namely, itis impossible for a company in the computer business to stay on top in two successive technological eras.

"Good luck to Steven A. Ballmer, the company’s chief executive since 2000, as he tries to sustain in the Internet era what his company had attained in the personal computing era," Mr. Stross, a business professor at San Jose State, wrote. "Empirical evidence, however, suggests that he won’t succeed. Not because of personal failings, but because Mother Nature simply won’t permit it."

A company cannot buy or merge its way out of the Single-Era conjecture. As far back as 1997, Clayton Christensen, a Harvard Business School professor noted that even well-managed tech companies try to prepare for the nest wave, but still lose market leadership.

Itis not that Microsoft didnit see it coming. Bill Gates alerted his company in 1995 in the famous "Internet Tidal Wave" memo. As far back as 1993, Nathan Myhrvold, Microsoftis CTO wrote a memo: "Roadkill on the Information Highway" that spelled out how even the PC software business would be extinguished by digital networks.

Mr. Stross explained how itis been a few years since Microsoft made money in its on-line business and how the numbers have gotten uglier since. Meanwhile, Googleis numbers are going in the opposite direction.

Microsoft is simply unable to dictate its own fate and escape from the Single-Era conjecture, the author concluded.