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The End of Microsoft?

 
 
 
 
 
 
 
 

Could Microsoft die in the next 10 years? Possibly. Here's why. Microsoft CEO Steve Ballmer made some noise recently when he predicted the demise of newspapers by 2018. "There will be no media consumption left in 10 years that is not delivered over an IP network," he told The Washington Post. "There will be no newspapers, no magazines that are delivered in paper form. Everything gets delivered in an electronic form."

So a newspaper columnist from Microsoft's backyard fired back, detailing how Microsoft might die first.

Bill Virgin's logic goes like this:

First, the Yahoo takeover collapse exposed Microsoft's weakness. "The effort to buy Yahoo to accomplish what it couldn't on its own speaks volumes about how successful Microsoft has been at dominating Internet content, delivery channels and ad sales (although to be fair, it did squash Netscape like a bug)." The company's efforts in gaming, portable devices and computer-TV convergence haven't failed, but other players have seen bigger successes (and have greater potential).

Then there's Vista. It's true that Microsoft practically owns the operating system market, but it's newest offering isn't exactly drawing rave reviews; and as Virgin points out, Microsoft knows it. And the coming onslaught of cloud computing presents a huge challenge for makers of boxed applications. (More on that here.)

Virgin doesn't quite spell out what will cause Microsoft's demise, but he fairly casts a spotlight on the tech giant's well known weaknesses. Users have made their feelings known, too.

But companies don't just disappear. Time will tell if innovations like cloud computing and SaaS will really make a significant dent in Microsoft's armor--or if they can harness those innovations for their own gain.

It'll be fun to watch, that's for sure.

 
 
 
 

3 Comments for "The End of Microsoft?"

  • mwmc June 13, 2008 3:53 am

    jonmca posts a significant and problematical current context for MS: market demands for strategic agility (but lack of real success so far is doing it). But here's an extension of that: Microsoft cannot, it seems, manage even a recrudescence of its old "embrace, extend & extinguish" method. (Today Yahoo closed with finality its latest major "embrace" attempt.) Tired analogy #611237: dinosaurs were very successful in their time; now, even if some magically appeared, they probably would not do very well: the lush bogs and vegetation have been everywhere transected with zippy freeways and invisible "web-ways." What's a 40-ton creature to do? Disclosure: none to report: no stock, no financial ties to MS, Goog or YaWho? mwm.

  • jonmca June 12, 2008 4:19 pm

    It's been discussed before, but it's getting more probable that before Steve Ballmer's announced retirement, Microsoft will be split into multiple, separate companies. Why? It appears to many observers that MS is now moving too slowly to be able to meet emerging competitive challenges, innovate and stay viable as a single company within a business sector that continues to see the explosive emergence of innovative technologies. Innovation at MS now seems largely piecemeal and incremental, and not strategic. This is apparently because of the time it's taking for MS senior management to attempt to maintain strategic and operational integration across all MS's various products and operational divisions. If Microsoft were spilt into separate companies, each of the businesses would be freer to develop and execute innovative technologies and to collaborate with non-MS rapidly emerging technologies, without having to coordinate a very broad set of interlocking legacy requirements and operating unit strategies across multiple and diverse market segments. Staff could likely be reduced, especially senior managers who spend their time attempting to make this business unit coordination work. Splitting into separate companies would also help MS resolve increasing problems with regulators with respect to their perception of MS market power. These are all factors that would help increase MS shareholder value in the long term if the split were well planned and executed. Of course there's a significant risk, somewhat like the risk of having a debilitating and probably fatal medical problem, or having high risk major surgery to correct the problem with the hope for a longer and more productive life. Disclaimer: I'm not a MS employee or shareholder. I've been in the IT industry and management using MS products for many years. I'm also speaking for myself, and not my company.

  • Robert Pogson June 11, 2008 10:21 pm

    "companies don't just disappear. Time will tell if innovations like cloud computing and SaaS will really make a significant dent in Microsoft's armor--or if they can harness those innovations for their own gain. " Even if the magnificent movements on the web do not touch M$, GNU/Linux and MacOS will continue to bite. GNU/Linux is taking more than 1% per annum away from M$'s share even while the market grows. Both competing OS are growing rapidly, MacOS in Europe and USA, GNU/Linux in the rest of the world. If this keeps up, M$ could be a niche player within ten years. If this keeps up, they will have no monopoly at all in five years. Even building a million servers will not help them if fewer people want what they sell. Drastic action by M$ will only deplete their nest-egg more rapidly. They have to change but will not until the end is near.

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