Microsoft stranded

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    Posted: 19 January 2011 04:29 PM

    FalKirk - 19 January 2011 07:57 PM

    “We established a new quarterly record with sales of 4.13 million Macs, representing 23% growth over the year-ago quarter. That’s almost 8x IDC’s most recently published estimate of 3% growth for the PC market.”-Tim Cook

    1) Their two largest selling products - Office and Windows - are stranded on mouse driven operating systems.

    2) Apple, with their 160 million iOS devices, owns the all important touch and mobile space. Microsoft has virtually no presence or much promise of having a presence any time soon.

    3)  Apple’s Macs are enjoying a huge halo effect from iPads.

    4) “...the Mac app store…has the potential to demolish what remains of Microsoft’s “desktop app” monopoly.”

    Attack of the New Thread.

    With sales results out, the tech world knows—a new resort company is here called iOS.  Features deep water ports, jumbo jets, ski resorts, tanning salons.

    Microsoft’s tankers leak too much oil and haven’t applied for an iOS berth.  Some ferryboats and smugglers get Apple products into M$ properties.

    Bing and Kinect are the only 2 intriguing things that Microsoft has for me.  Office ?  too expensive.  Windows server ?  Over my dead body.

         
  • Posted: 19 January 2011 04:55 PM #1

    “‘Listening to Apple’s quarterly conference calls these days is like watching a once-in-a-generation sports team demolish every other team in the league,’ Henry Blodget writes…”

    No, it’s once in a millennium.  And the reason for it is not complicated.  The software company that still controls 70% of the world’s OS market is dysfunctional, if not dead.  That means that computer makers whose machines are dependent on that OS are also dysfunctional.  People will put up with dysfunctional software and hardware for while, mainly because it’s painful to change.  But sooner or later they move on.  This is now “later”.

    It started slow and it has snowballed.  Now it’s an avalanche.

         
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    Posted: 19 January 2011 04:56 PM #2

    I think it will take 50 years for MS to die if at all.

    The world is too dependent on Windows to run, to see its markets share fall too much.  Keep in mind even Macs run Windows.

    I think they will come up with an equivalent Tablet at some point that works well with Windows.  It may take 5 more years, but the market share that Apple picks up will not dent them that much.

    In the end I focus on other opportunities apple has more then eating into MS share.

         
  • Posted: 19 January 2011 05:43 PM #3

    I may post this elsewhere but in the meantime.  Meet the new enterprise Apple.

    http://www.apple.com/ipad/business/profiles/ge/

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  • Posted: 19 January 2011 06:52 PM #4

    What a great video - thanks for posting Bill.

         
  • Posted: 20 January 2011 01:09 AM #5

    omacvi - 19 January 2011 08:56 PM

    I think it will take 50 years for MS to die if at all.

    The world is too dependent on Windows to run, to see its markets share fall too much.  Keep in mind even Macs run Windows.

    I think they will come up with an equivalent Tablet at some point that works well with Windows.  It may take 5 more years, but the market share that Apple picks up will not dent them that much.

    In the end I focus on other opportunities apple has more then eating into MS share.

    In 5 years a tablet computer will likely be passe.  Microsoft hasn’t invented anything in 10 years.  They are burning capital such that they will be broke in 10 years.  Where’s the up side?

         
  • Posted: 20 January 2011 01:24 AM #6

    Zeke - 20 January 2011 05:09 AM
    omacvi - 19 January 2011 08:56 PM

    I think it will take 50 years for MS to die if at all.

    The world is too dependent on Windows to run, to see its markets share fall too much.  Keep in mind even Macs run Windows.

    I think they will come up with an equivalent Tablet at some point that works well with Windows.  It may take 5 more years, but the market share that Apple picks up will not dent them that much.

    In the end I focus on other opportunities apple has more then eating into MS share.

    In 5 years a tablet computer will likely be passe.  Microsoft hasn’t invented anything in 10 years.  They are burning capital such that they will be broke in 10 years.  Where’s the up side?

    The upside is when Ballmer leaves, for starters.  The stock jumps 5% on this news.  From there, I dunno.

    With regard to its two cash cows, don’t underestimate the personal investment people have made in Excel and Word.  You could create your own Excel and Word-like products and make them free and people would rightly reject them both if it required them to learn a new interface.  Just like I don’t want to learn a new language, I don’t want to learn a new spreadsheet nor a word processing program.

         
  • Posted: 20 January 2011 02:18 AM #7

    Microsoft sucks, always has.  Don’t get me started.  Nobody will miss them when they die.  Gates left at the right time.  Even a rat knows enough to swim away from a sinking ship.

         
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    Posted: 20 January 2011 02:31 AM #8

    Mercel - 20 January 2011 05:24 AM
    Zeke - 20 January 2011 05:09 AM
    omacvi - 19 January 2011 08:56 PM

    I think it will take 50 years for MS to die if at all.

    The world is too dependent on Windows to run, to see its markets share fall too much.  Keep in mind even Macs run Windows.

    I think they will come up with an equivalent Tablet at some point that works well with Windows.  It may take 5 more years, but the market share that Apple picks up will not dent them that much.

    In the end I focus on other opportunities apple has more then eating into MS share.

    In 5 years a tablet computer will likely be passe.  Microsoft hasn’t invented anything in 10 years.  They are burning capital such that they will be broke in 10 years.  Where’s the up side?

    The upside is when Ballmer leaves, for starters.  The stock jumps 5% on this news.  From there, I dunno.

    With regard to its two cash cows, don’t underestimate the personal investment people have made in Excel and Word.  You could create your own Excel and Word-like products and make them free and people would rightly reject them both if it required them to learn a new interface.  Just like I don’t want to learn a new language, I don’t want to learn a new spreadsheet nor a word processing program.

    When my workplace upgraded everyone to the latest release of office it seemed like a brand new interface (much to everyones annoyance). I don’t know if they did this just so they could make it look new and give a reason for people to buy it. Anyway my point is that everyone eventually adapted and now use it with minimal complaint, so I don’t think using a different companies spreadsheet program would matter either.

    My prediction? Microsoft will be merged or sold off over time, piece by piece. Maybe in 5 years a big chinese vendor buys the windows brand (lenovo?), the xbox division gets sold off or split into a new company, and Microsoft becomes like IBM as a software services company for enterprises, and makes good office suite software for all platforms. That would be a good move on their part.

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  • Posted: 20 January 2011 07:59 AM #9

    Microsoft should be jumping all over iOS with Office. The stickiness of Office in the Enterprise is difficult to over estimate. As soon as you try using some other product, you run into compatibility problems with almost everyone you ever exchange files with. Even with the Office look-alikes. 

    With the adoption rate of the iPad in the Enterprise they would have a huge winner on their hands if they put all their weight behind extreme compatibility with the desktop versions.  Just the way they have with Office 2011 for the Mac, which is outstandng by the way.  That plus cloud functionality. With that said, I don’t see it happening with Balmer in charge. I don’t see him ever having the mindset to bless iOS in this way.

         
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    Posted: 20 January 2011 08:07 AM #10

    Lstream - 20 January 2011 11:59 AM

    Microsoft should be jumping all over iOS with Office. The stickiness of Office in the Enterprise is difficult to over estimate. As soon as you try using some other product, you run into compatibility problems with almost everyone you ever exchange files with. Even with the Office look-alikes. 

    With the adoption rate of the iPad in the Enterprise they would have a huge winner on their hands if they put all their weight behind extreme compatibility with the desktop versions.  Just the way they have with Office 2011 for the Mac, which is outstandng by the way.  That plus cloud functionality. With that said, I don’t see it happening with Balmer in charge. I don’t see him ever having the mindset to bless iOS in this way.

    And Apple should purposely “break it” just like MSFT did to all those other products over the years grin

         
  • Posted: 20 January 2011 08:38 AM #11

    MSFT has a real dilemma.  Do they acknowledge IOS with Office?  This would facilitate and appear to endorse a significant exodus from Windows.  Do you give up low hanging Office fruit or protect the much larger Windows income?  Not an easily answered question.

         
  • Posted: 20 January 2011 08:48 AM #12

    ncgo4 - 20 January 2011 12:38 PM

    MSFT has a real dilemma.  Do they acknowledge IOS with Office?  This would facilitate and appear to endorse a significant exodus from Windows.  Do you give up low hanging Office fruit or protect the much larger Windows income?  Not an easily answered question.

    The truth could be simpler: Perhaps they are unable to port Office to a new platform at reasonable expense, as compared to the expected gains? I would not be surprised if they are unable to make a business case for it, even if they don’t fear cannibalization and strategic side effects.

         
  • Posted: 20 January 2011 09:23 AM #13

    ncgo4 - 20 January 2011 12:38 PM

    MSFT has a real dilemma.  Do they acknowledge IOS with Office?  This would facilitate and appear to endorse a significant exodus from Windows.  Do you give up low hanging Office fruit or protect the much larger Windows income?  Not an easily answered question.

    Well if they can’t make such a decision then they should split the company up, so that one franchise is not hobbled by another one.  With that said, I don’t think that a strong iOS Office product necessarily damages Windows.  As much as I love the iPad, I don’t see the desktop or laptop disappearing in the Enterprise any time soon.  I believe that a strong iOS product actually makes Windows MORE valuable to many.  Together with many Microsofts Enterprise software product. Although the same can be said for MacOS too. 

    So if Windows provides a stronger overall experience with Mobile devices even if they are iOS based, then the Enterprise is going to have more reason to resist the temptation from other OS’s such as Chrome when it hits.

    So in short Windows+Office on iOS = stronger Windows, and
    Windows-Office on iOS = weaker Windows

    However, I don’t think Balmer would agree, and in fact I see Microsoft resisting this because it gives away a potential differentiator with Windows Phone 7.  Doomed thinking too, but that’s what Balmer excels at.

    What would be a reasonable penetration for Office on iOS?  20%?  With that number, there is a pretty decent revenue potential, whether with perpetual or SaaS licensing.  That’s before thinking about how Microsoft might make such an offering even more valuable with a killer cloud synching service that is Enterprise class.

         
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    Posted: 20 January 2011 11:59 AM #14

    Mercel - 20 January 2011 05:24 AM

    You could create your own Excel and Word-like products and make them free and people would rightly reject them both if it required them to learn a new interface.

    I don’t know if I agree with that. What you’ve described is OpenOffice. My company has almost completely moved to OO. I’ve written my last couple of books on OO. For most people OO does everything they need. It now has as much as 20% penetration in some countries, 9% in the US (http://en.wikipedia.org/wiki/OpenOffice.org#Market_share) MS is losing their grip on Office and once that goes I see Windows crumbling as well.

    WinPhone7 is DOA IMO. It just cannot compete with Android. Free with more features beats expensive with fewer features every time.
    Win7 has only done well only because Vista was so terrible. I know a lot of people still using XP (my company laptop is still XP).
    Win Server is good but in my company we’re deploying more Linux Servers.
    Office is expensive so it’s biggest competitor is old versions of Office.

    Ballmer has screwed up everything he’s touched. I hope he stays where he is for a very long time.

    The MS era is fading. They’ll exist for a long time but they will never have the stranglehold on the industry they had in the late ‘90s.

    Maybe that’s what Apple’s cash hoard is for. They are waiting and in another 5 years they will buy MS. Then they can liquidate it and give the money back to the shareholders. :eg:

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    Posted: 20 January 2011 03:12 PM #15

    With sales results out, the tech world knows?a new resort company is here called iOS.  Features deep water ports, jumbo jets, ski resorts, tanning salons.

    Isn’t it deliciously ironic that the underdog tech company who in the 80’s sold computers “for the rest of us” hit its stride with the same purpose 20 years later, and is now one of the most valuable businesses on the planet? In spite of their increased market domination, Apple still has that “we’re not your father’s OS” vibe, and I think that’s really cool.

    Microsoft hasn?t invented anything in 10 years.

    Zeke made an important point here. Seriously, what has Microsoft been doing besides being an also-ran company: shamelessly attempting to ape Apple, faultering on partnerships and waffling on their own technology? Watching their moves has been like one of those cartoon gags where someone drops a banana peel in front of them, they slip on that, then they step on a rake and smack themselves in the face, etc, etc. And the idiots in charge - such as Ballmer and Roz Ho - are perfect foils for slapstick.

    The only really smart move they may have made in the past decade might have been purchasing Halo and leveraging XBox for home entertainment. Beyond that, I’m at a loss.

    Microsoft’s problem is actually fairly similar to Sony’s. They’ve gotten too big for their britches and lost focus, so ultimately they’re losing battles on a lot of fronts.

    So where do they go from here? The cost for making PC’s and licensing Windows to run it has always been a race to the bottom, which I believe bottomed out quite some time ago. The partnerships have definitely become strained, as some vendors such as HP and Dell have already chosen to use other operating systems for their devices.

    I think Microsoft’s next logical step is to circle the wagons around their flagship products - meaning that they’re eventually going to have to start manufacturing their own machines. To fend off Office alternatives, they’ll have to start selling it as a cloud service either ad-based or for a nominal fee, and include team-oriented productivity tools not unlike 37 Signal’s Basecamp. And for christ’s sake, lay off the also-ran developments: if they’re going to introduce a new product, it should be something that Microsoft does way better than anyone else. When it becomes a “me too”, it should be shelved. Failed executives should not be allowed to linger, either. Another telling aspect of just how disjointed Microsoft has become is when someone important like Ray Ozzie sees the future and leaves, and Ballmer still just doesn’t get it.