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MS Sales Growth Limited by Delays in Windows
Alien54 writes "As reported by Bloomberg, Microsoft Corp.'s sales growth will probably drop below 10 percent next fiscal year for the first time because delays in the next version of Windows have created the longest-ever lag between releases of the software. They go into some detail on how the lack of new products also hurts multiyear subscriptions, because clients that buy the contracts expecting to get product upgrades may not renew if new items won't be available for a while. Didn't someone say once that they have enough reserves to last 5 years without any sales at all?"
I wonder how much Longhorn is going to cost exactly? A combination of Microsoft's obviously declining userbase and 5+ years of development costs needing to be covered is going to mean Longhorn's pricetag will have to be pretty steep if MS is going to profit directly from it.
Hmm... the article claims "Windows runs 93 percent of the world's personal computers". That's way more than I would have guessed. How is that measured exactly? And who by?
...for Microsoft. At least my computer doesn't seem outdated even though I'm running Windows 2000, which is over 4 years old. That's like 50 in internet years.
Karma: Meh (Mostly from meh.)
I do. I see microsoft branching from software and developing a fleet of spaceships capable of faster than light travel.
Depending on how well the Distribution creators handle this, this can be a blessing or a curse for Linux. Generally speaking, companies want equal or better features before they consider switching (equal, if price is the main concern - better, if it's not).
The long delay between releases will give Linux a chance to improve itself, and present a better alternative to Windows, with more features, better security, and a lower price.
However, this can also be a curse - MS is taking their sweet time, and this may be due to fixes, or it may simply be that they are developing stable, great features. If Microsoft releases a slew of new features which businesses find to be essential, Linux will once again be playing the "catch up" game.
It will be interesting to see how this plays out over the course of the next few years.
Is that legal?
Does it hurt?
Microsoft's cash reserves as of Dec 31, were 53 billion dollars. To put that into perspective, it is enough to "fund NASA for a year, assemble a fleet of 100 Boeing 747s, and buy every person in Seattle a 2004 Subaru Outback -- with a few billion left over for incidentals."
Math:
ON the heels of some wacky law threats this week i think this is a setup for a perfect trifecta:
Rambus : We didnt make enough money because you didnt license enough from us. We will sue you.
Fox News : You wont sell your billboard to us. We will sue you.
MS : You arent buying from us because we are hyping our new stuff years before its ready, we will sue you!. (?)
(this post is for humor purposes i am not serious, such a lawsuit would be silly.)
My company does Windows consulting primarily, but we do have two Mac guys (one of whom is me) who handle the art departments at large corporations, among other Mac-based clients.
Company management has been concerned for some time that the 'project' aspect of our business will take a nosedive during this long period between major Windows releases-- many of our clients have already upgraded to Windows 2003 server and have mostly XP and 2000 client workstations that won't need replacement for a few years. With the Longhorn delays adding up, the Windows integration side of our business is facing something akin to a nuclear winter.
In light of this, we just had a long meeting yesterday about things we need to do to bring in new Mac clients and otherwise grow the Mac side of the business.
Hopefully, Apple will take advantage of Longhorn's long gestation period as well.
Do you think that sales have also come down due to lack of compelling reasons to switch.
Office 97 as good as 2000/XP/2003 Win 2000 as good as XP 98 fine for home use..
What's the point in switching unless to Linux? Unless you like to donate to Charity through the Bill Gates foundation.
Delays in Windows are only one problem.
Some of the other serious issues Redmond is facing:
1. Worms/spyware/viruses destroying the home market
2. Lack of reasons for further upgrades to Office
3. Enterprise shift to Linux
4. Consolidating competition from IBM & Novell
In general terms, their problems stem from having cornered the market for a product that is almost out of fashion: high-cost, complex (and thus insecure) software. People need low-cost, secure software.
Their best hope is to produce an interim release of Windows 2000 that has been seriously upgraded in terms of security. But even then I don't see how they can survive the commoditization of their core market.
5 years' budget goes awfully quickly when you are used to double-figure growth.
Sig for sale or rent. One previous user. Inquire within.
The real impact for Microsoft will be less revenues and a lower stock price.
Its at apoint that the wait will help. Because most operating systems 98, 2000, me (yuck), XP work on the same computer. What is the incentive to upgrade. I forgot the eactual statistic but isnt there a sizable percentage of the computers on the net still using 98. I know we have two computers at home using 98. And there is no reason to upgrade them. But in like 5 years or so the computers are going to be so much faster. Wasnt it that the specs for longhorn needed dual processors running at 4-6 ghz, a gig of ram and like a terabyte of hard drive space. That is something that these prexisting systems just wont know what to do with. by waiting so long there no way that 98 is going to be able to run on a system like that. Everyone will have to buy longhorn.
30% Troll, 50% Underrated, 10% Interesting
Score:5, Troll
Vacuum Cleaners?
Naa... they probably wouldn't suck...
I am posting anonymously for obvious reasons.
I can safely tell you to expect a "SE" version of Windows XP by December of this year. It will have some enhancements and adjustments, plus it will also have a new media center-like program included.
Expect an announcement in the next two or three weeks.
So we're used to having MS release a new hit cd every two years. By hit I mean boy-band tracks hastily cobbled together and pushed out the door to an awaiting fanbase. (look, how else do you explain it?)
Ballmer and Gates make press conferences touting their new hit singles like "A New Outlook" and "DRM - Quicker Than A Ray Of Light" -- but of course you can't just buy the singles. You have to buy the entire CD...and good luck trying to get rid of the tracks you don't want.
Now people started complaining about how their hits aren't put together well so they decided to finally take it slow, spend time at the studio, and actually sit down to make good music. The fanbase was like "awwww, you didn't have to do that!" while the critics were "riiiight, like they'd REALLY do that."
Then MS realized they're not going make the 2 year cycle deadline so faster than you can say "oops, I did it again" they start tossing out stuff they were promising to deliver. Their new hit "Palladium Blues" may have to wait. That new Filesystem track that you could Tae Bo to -- gone.
So what's left? Probably a complete rehash of their latest album. Maybe they'll P-Diddy some of the stuff Apple released a few years ago. Toss in a reworked "IE Blockin' Da Poppas" along with Ballmer's dance moves and the fanbase will eat it up like a warm leftover casserole.
As for me, I'm a critic, not a fan. I'll stick to my GPL's Greatest Hits cd. You know, the one that comes with the "I Honk For Herring" sticker and a video of Stallman singing the "Hacker Song." I must say I passed on the Torvalds In Speedos poster, though.
Microsoft can survive for 10 years without selling even a single product or service. They can survive on the vast Research and Development(R&D) they've built-up over the years. Well, guess what, Bill Gates won't be the richest if they stop selling stuff, and computer industry will be a lot better.
oooooo!! ;)
1. Get job at MS.
2. Threaten to blow the whistle on some illegal behaviour.
3. Profit!
Silly rabbit
I am terrified to think what will happen if MS actuall gets it right with Longhorn.
We have all, to various extents, been accomplices in MS monopoly 9who has NEVER purchased any MS product?)
We clammor for more scurity and fewer bugs and so forth. What if MS ACTUALLY provided a secure and stable OS? And then people upgraded to it. What then of Linux, OS X, and the like?
I only came here to do two things; kick some ass, and drink some beer...looks like we're almost out of beer.
Microsoft is currently threatened by a barrage of minor issues which add up to something serious when combined.
.Net and reasonably fast, preventing their newest system from completely stealing Sun's thunder. Once again, damaging credibility.
.Net, the X-Box, and WMA with DRM. MS-Office and Windows are still their biggest products, but they can't increase in sales very much.
.Net is that, as it has very much promise and says something about how much total change will come with their next OS release. Also, .Net can compete with Java somewhat, helping them in a buzzword cattle.
1) Lack of new products prevents sales and damages customer loyalty.
2) Severe worms damage customer loyalty, increase costs in maintenance and customer service.
3) Competing products getting stronger with OS-X on the desktop on Linux both embedded and in servers cut into what sales they would have.
4) Strong competition generates press for opposing sides, making them appear less innovative than they want to.
5) Constant lawsuits present a steady sapping on resources.
6) Constant web-popups make IE seem sad in comparison to Firebird and Opera, as well as a lack of features being painful. This detracts from their general appearance and aids competitors.
7) More people are satisfied with their current systems and are just refusing to upgrade.
8) Piracy of windows is staying widespread despite product registration, and the lack of legitimate copies is adding to the virus issue.
9) The next version of Java is looking stronger than
10) Although X-Box started gaining on the other consoles finally, all the competing systems are starting to push even more for handhelds, and likely integration between the two, resulting in an aspect where the X-Box will be lacking.
11) The G5 chip is the first time that a Macintosh processor has been seen as competitive with the top Intel chips, further undermining their superiority.
12) The iTunes music store is still unrivaled, re-solidifying Macintosh as the OS for multimedia, along with programs such as FinalCut and Garage Band and products such as the iPod.
13) Governments are starting to strongly consider open standard, raising the lobbying costs for Microsoft and potentially requiring some new file formats to be supported by them.
14) OpenOffice.org shows a technically capable alternative to MS-Office. Where MS-Office was once clearly on top it may have to start fighting for its place soon. Also, the latest version of MS-Office, MS-Office XP, doesn't run on as old of hardware as OpenOffice.org, so many people with old Windows systems have an alternative upgrade line, as opposed to being locked into upgrading computer, OS, and office suite all at once.
15) Many large contracts for Linux have been seen recently, harming Microsoft's public image more.
There is other stuff, but I can't think of it at the moment.
I would say their strongest pieces at the moment for increasing sales are
Their OS is just not going to be ready before 2006, so it cannot stimulate a recovery. What they need is something to make it worth the wait.
MS-Office was traditionally their big seller to tie people into their systems, but it's basically finished up. They have very little room to improve. Most of the improvements that could be of value cost more to develop than they will bring in sales (better type-setting control and similar advanced features) or will have a huge risk of damaging their current monopoly (a new office suite can have a radically new UI and be easier to use without losing customers).
X-Box, on the other hand, is totally up-and-coming and is technically superior to the competition. If they can get the X-Box2 out in a timely manner, they can get press about being innovative, they can get a rush of sales from nowhere, and they can stimulate their gaming division, giving them a third strong arm to thei
... the prohibitively high cost of the recommended standard hardware configuration for Longhorn is also going to effect MS' sales.
Of course, this is all good news for Linux on the desktop.
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Does anyone else wonder what it might mean when a company as massively gigantically ginormous as Microsoft can't churn out a new release of a flagship program in a year or two? They are either doing something exceptionally cunning and devious or else they simply can't make a new version in this space of time, and I'm sure we all go with option b.
I just think it means personal computers are now officially insane.
They can survive on the vast Research and Development(R&D) they've built-up over the years
Yes indeed. In fact, their research division has been so successful, it has its own brand name.
To make laws that man cannot, and will not obey, serves to bring all law into contempt.
--E.C. Stanton
Despite all their service packs and hot fixes, they never really seem to FIX anything. Besides 'Doze itself there are a bunch of MS products I've used over the years that had serious problems. Not necessarily "bugs" per se, but features that didn't work as advertised or missing functionality in general.
Case in point: VS.NET 2003 has several annoying bugs and problems that have been the subject of hundreds if not thousands of complaints. It's been out a while now and there's no service pack in sight. Maybe half a dozen features from VS6 were "removed". Sure, they added a hundred, but those 6 were commonly used and their disappearance causes angst and frustration on a daily basis. What's the MS response to all this? "Wait for Whidbey."
Right. That's just been delayed again. And they want you to pay for it, of course. Why can't they just friggin' fix the garbage they've put out already? There are countless similar examples over the years. Access, Word, SQL Server... you name it and it has had bugs at some point that MS refused to fix. They say to wait for the next version, but that doesn't address the core issue that you have a piece of expensive software you already paid good money for and they refuse to fix it. They refuse responsibility to make it work right. Perhaps, at some point, software should have warranties if it costs beyond $X. I'm sick and tired of paying for MS software that they essentially sell "as is".
This doesn't even begin to address the notorious problems they have with security. I think they're related. It goes to their culture of never having to fix anything. The recent years of being forced to patch holes and vulnerabilities goes against everything in their culture. That's why they can never get the security fixes "right".
So now we have an opportunity. Longhorn is supposed to be packed with great new features such as WinFS, C# and .net. Are we just going to copy them, or come up with some new personal computing paradigms? If so, what would they be?
Computers are useless. They can only give you answers.
-- Pablo Picasso
You /., linux zealots, and Windows bashers never present the true facts. Windows may be closed source and proprietary but there are many programmers that contribute freely to Windows. Just in the past month alone I've received all of these updates at no extra charge:
Not only that, but I received a new browser enhancement called mywebsearch, a free time synchronizer called precision time, and I can check the weather anywhere with my new (might I also add...free) weatherbug program.
I understand that we can expect a ton more free programs/upgrades like the above when longhorn comes out. Quit bashing Windows and admit that more free programs/upgrades are available for us Microsoft users than you Linux/Mac users!
Microsoft's Business model has always been to create an artificial demand for non-essential products. Why should you have to upgrade your OS every 2 years!?? I have clients who are still happily running their businesses with Windows 2000 Server and Windows 98SE clients; and if it wasn't for Microsoft eliminating support for NT and 95, they would probably still be happily using those products. What's especially annoying about Microsoft is that they keep removing features with every upgrade. When one of my clients upgraded from 95 to 98 they were surprised to find that they lost their intra-office e-mail (MS Exchange Server used to be free with 95) and couldn't understand why they had to BUY Outlook. Another client was incensed when they replaced one of their 98SE computers and were forced by Dell to purchase it with Windows ME (ugh!) only to find out that Microsoft had removed all support for tape drives. Another client was pissed off when they replaced one of their Win 98 clients with a Windows XP Home machine only to find out that he would have to pay more to upgrade to XP Pro because XP home wouldn't automatically log in to his NT server like his 98 clients could. Another reason Microsoft likes to release new OSes often is that it gives them many opportunities to "break" their competitor's programs (in the application "space"). Just ask Corel or Borland how they feel about MS's new OSes. Also, with each new OS, Microsoft becomes more draconian. Don't forget what they've done with Media Player (with the EULA that grants them the right to pretty much do whatever they want to to your computer). Now they're going to build DRM right into the OS!? We're supposed to trust Microsoft!!? I do like Win 2000, and that's the main OS on most of my Windows boxes. I think that Windows XP would be a fine OS if not for the mediocre apps you get with it (Internet Explorer, Outlook, etc...)and the annoying invasive features (Media Player's DRM, activation etc...). It would be nice if Microsoft would work on getting one OS right and then supporting it for a while, rather than giving us "disposables" (ME being the most obvious example). Microsoft treats it's Operating System just like it was an application suite. That's not what I call a stable platform. This also MS's strategy in the "development space". Everything's a moving target and there's attempts to make everything "proprietary Microsoft" (just look at Microsoft's attempts to derail Java with J++, and any resemblance of VisualBasic.NET to Visual Basic is purely coincidental...). I'm steadily migrating clients to Linux, on both the Server and Client side, and also in the "application and development space". Those I have migrated so far are very happy with the stability and security, and enjoy not feeling manipulated by microsoft's release schedules and arbitrary licensing.
Only problem is that as you approach the speed of light, MS SpaceShip 2010 bloats up until it reaches infinite mass and is completely unmanoeuverable and unusable. so very much like Windows.
I worked there 3 years. Every company meeting went like this:
Jesus god all mighty we got a lot of money from Office and Windows this year. Here's their breakdown, and here's everybody else, some made money, some didn't, but who cares because Office and Windows really came through!
Now, even though it's just ridiculous, we still expect 15-20% growth from Office and Windows again. And I'll be damned if they don't go out and do it, year, after year, after year.
Trust me, if MS does one thing at all, it's make its numbers.
... only live in their own little worlds, with NYC or LA or DC rent structures guiding what they think things should cost, flying everywhere, lunches that cost what a working family uses at the grocery store for food for a week.
And etc rantage there.
quote-age here:
``The overwhelming majority of PCs are not running Windows XP and the opportunity is quite good for the Windows XP product wave ahead of Longhorn,'' Connors said in an interview in April.
DUH, earth to rich guys, no it's NOT Mr. Connors, the overwhelming number of people are using 98, have gotten used to it, their hardware they paid MOST serious folding money for just a few short years ago still works,they get everything done they want to do, And there's *little to no reason* for them to get EITHER a new computer or a new operating system. Most folks could get by quite handily dropping 50$ on a new stick of ram, good to go for several more years, if they even feel like it, and people are actually getting hip to firewalls, ad aware action, etc. It's slowly turning around, but folks are learning and they aren't as easy to fake out with blinkenlights stuff any longer.
Time for the hardware and for-sale OS guys to buy a clue, they can use some of their dot bomb stocks as "money" for that, there used to be a decade called the 90s, they all made tons of cash, OBSCENE huge amounts, now it's back to the real world. They will sell SOME, they will make SOME money, they won't *make* (sell ridiculous cheap to make 10 cents copies of stuff for huge $$$) money like the 90s, because people are now over that period of "irrational exuberence". Same like the movie and music guys need to bingo to that, people are just buying less of "stuff" now, especially stuff that is still more or less working OK, they are concentrating on the essentials, like paying the mortgage, the car off, kids in school, paying down CCs down that are already maxed, fed state and insane property taxes, etc. In fact, I can't think of a single person I know who is "clamoring" for some new windows OS, either XP or son of XP. People, when and if they get a new box, expect some OS on it, that's it for the most part. That's when they upgrade, and frankly, even the dullest is hip to whatever you buy brand new next week is borken and needs to be patched, so they figger, why spend an extra 100 clams just to download more patches starting the next week. They are already doing that now. Now from win 3.1 to 95 and then to 98 you got a lot of folks switched, since 98, it has slowed way way down, for the reasons I stated. They see "upgrading" as getting snookered now more than GEE WHIZZ, JISS CAN'T LIVE WITHOUT THAT NEW XPTURBO STUFF, GOT TO GET ME SOME RIGHT NOW!
Ain't happening, and them rich dudes with degrees and status and hanging out with all the other rich dudes can't figger it out why not..
Now, this isn't slashdot readers, or *some* businesses, but for everyone else, there is NO need, sales will stay slumped. And all the rich analysts and marketing folks trying to resurrect that gravy train just will not get it that spending another grand (whatever, I am ranting) for a new box and OS is not all that vital to people to whom that represents a real important level of "spare" cash to come up with, to do *exactly* what in essence they are already doing. If a new box and OS represented only like 25$ to joe paycheck, sure, they would go buy a new one. It's all relative.
The future 5 to 10 years down the road now- is free software and real cheap hardware,almost throw away when it's broken hardware, and THAT'S IT, time for them boys to come up with a new business plan soon, hanging on to the 90s won't cut it for too many more years.
Mac advocates will claim victory.
BSD advocates will claim victory from beyond the grave.
"MS Sales Growth Limited by Delays in Windows"
I wonder if this could be reworded as
"MS Sales Growth Limited by Development Model"?
Seems logical that, as the OS grows more and more complex, and the same product needs to do more and more (since it's closed source no-one else can offer assistance on the OS level), a single company with developers might not be enough to create an OS.
I think Microsoft is struggling very hard to get Longhorn out reasonably quickly while still having enough features to encourage users to upgrade. It will be very interesting to see where all this goes with, say, the "Windows" two versions later than Longhorn or so... And how quick/efficient open source software development will be then.
Beware: In C++, your friends can see your privates!
This is exactly why Microsoft has hinted before at an intermediate product between XP and Longhorn. It's not to provide customers with a better product while they are waiting, it's a form of Microsoft "passing the hat". Have we seen this behavior before? Think Windows 98, Windows SE, Windows ME. Did SE and ME provide anything sigificant to provide us with anything significant to put us in a position of XP? No. Did it provide Microsoft with anything? You bet. Pull together some early code, test it for compatibility with Win98, burn some CDs, push it onto the market, and all of the casual users run to BestBuy to keep their PCs up to date.
Microsoft doesn't have a need to keep the shareholders happy, simply because there are very few outside an inner-circle within Microsoft (clumsy, but accurate). Remember: Microsoft hasn't|doesn't pay dividends, hence their cash reserve (warchest) in excess of $40B.(for those who doubt divdends are paid, I suggest you spend a few minutes of research. Some key words to help you in your search: "Microsoft stock Nader dividend". Nader is only involved after Microsoft failed to pay dividends for a long, long time and he tried to leverage them (so far, unsuccessfully). Basically, adding his name to the search helps to reduce the size of your search because without it, you'll get far too many hits and will be stuck with wading through them. Stock & owership are one thing when it comes to things such as purchasing another company or just plain leveraging, but when it comes down to hard, cold cash, little can be done to compete, hence Microsoft's true power.
I'm a bit skeptical about your figure of four years for Microsoft to produce Windows NT. If I recall correctly, Microsoft hired a bunch of engineers away from DEC, who then created Windows NT from some IP and code that Microsoft had left over from their collaboration with IBM on OS/2.
That was my point. The 90s being the exuberant decade(everyone is going to get rich doing each others laundry, ie, the stock bubble), people who had never gone into personal computing went out and got one, at huge cost for the time, a brand new major appliance expense, equivalent historically to-say-electric refigeration talking over from ice boxes in terms of advances,or TVs replacing radios in the 50's, in terms of tech complexity, and totally new cost to be added to the family budget. It had to be squeezed in somehow, and the euberance part was the tipping over point, when the decision was made and that sweet spot of around 1200$ was hit for a decent desktop, people didn't want to get "left behind". They saw references to dot com this and that, people were asking for their email addy, etc, so they had to, consumerism pressures.
The rest is as you say, and what I said, it's good enough now, there's very little need (VERY broadly speaking)to upgrade either hardware or software OS, either on the personal desktop or in office-type business. Really, the only practical need is more RAM on most machines, and firewalls and antivus softwares. Hence, slumping sales, dropping prices, etc.. the industry could have dropped prices earlier, but they still had huge untapped market, so they kept profits up, which further exasperated the market exuberance,they believed their own hype, went nuts, it was a false profit potential that got projected beyond a reasonable level of maintainance, it couldn't be sustained, so prices dropped as the newer assemblers and vendors hit the markets, by-passing a lot of the mainstream vendors,in other words, the rise of the whitebox and the local mom and pop and getting boxes in regular department stores really helped bust the bubble.
Then the horror stories sunk in, viruses, patches, viruses, patches, crashes, etc. The machines kept working *sorta well enough* obviously, but by now, 2004, folks are leery, they is no native trust like there was even 6 years ago, they don't swallow the marketspeak, they got sophisticated in their lookings. People aren't that stupid, they learn from getting burned, and are holding out now for uber cheap almost free hardware before going forward again. it has to be orders of magnitude like 4 times better for 1/4 the cost, or something like that, before they will consider it, and they assume the OS is just free, no desire to go pay 1/2 or 3/4ths of what a new basic entry level pc costs at a whitebox shop for a disk in a wrapper on the shelf, when that new peecee has an OS on it anyway.
Frankly, OSes are not worth 100$, or 189$ now, they are worth like 10-20 bucks, tops, what an entertainment cd or dvd costs, because that's all it is, bits and bytes on a disk. That's the only rational OS market level left, for in the future, IMO. Even server OS will go that route, inevitable, it's becoming almost common place for google and the admin you are paying already to be "the support infrastructure" of note.
It's a freaking piece of plastic, people can see that. What past market prices were reflected ultra new, emphasis on sparkling, new, and improved, now it's just mostly new, and only very slightly improved,and not worth any major expense really.
I don't know the stats, but I would guess (really is a guess I'll admit) XP installs are 90% or better OEM sale with new boxes, not people going out to upgrade their older boxes on purpose "just because" its new and shiny and sitting on the shelf.
6GHZ/2GB/1TB specs HAS to be a JOKE. The only way Microsoft would make money off the machine is new comptuers, seeing that older computers coundn't run it
You are completely correct, and completely missed the point. MS has driven the hardware market for over a decade.
Because MSWindows3.1 was limited to 16MB, the memory sellers had to keep the price on 16MB of RAM as high as possible, because they couldn't sell more to the public. When MSWindows95 both allowed and required more, RAM immediately dropped in price, but everybody was buying it.
MSWindowsME, 2K, XP each required a better processor than the last because MS kept adding garbage to the OS that made it slow.
Hard drives have finally escaped MS's control. Previously, you needed a larger hard drive when you installed a newer MS OS, MSOffice, or MSVisualStudio. The only other programs for the public that required hard drive space were games, and you could uninstall them. Now people are buying very large hard drives to store their music and movies. A friend just bought an additional 300GB drive because he filled his 200GB drive in less than 6 months by recording TV shows.
MS's statement that Longhorn ("Windows 2010") will require 6GHZ/2GB/1TB was a promise to the PC manufacturers. The manufacturers could start selling Linux PCs that get great performance, and try to make money on support (with more expensive technicians.) Or they could stick with MS, and sell tons of hardware if Longhorn is ever released.
The downside is that the only reason people upgrade today is when their PC is slowed by spyware and viruses. Again, MS gets the credit for making it possible to continue selling PCs to the general public. With older hardware, people would notice when an evil program was installed. Now they do not complain until they have around 50 spyware/viruses installed. If people started buying Linux PCs, viruses and spyware would not slow their PCs, and nobody (except gamers) would upgrade.
MS's delay in releasing a new OS is because MS's sales growth is limited. They are having difficulty convincing people to upgrade to XP. Longhorn will not be have a killer app that gets everybody to buy a new PC. MS sales growth is slowing; soon it will decline. They desperately need a new cash cow, because MSWindows and MSOffice are becoming unwanted.
Nobody bought WindowsXP without a new PC. Nobody upgrades MSOffice unless they buy a new PC. MS must keep delaying Longhorn until enough people have upgraded from MSWindows98 to make it worthwhile. A 1 GHz PC is more than good enough for the general public. MS needs to tell the PC manufacturers that business will improve if they wait long enough. That is why they have released those silly specifications.
I spend my life entertaining my brain.
Several years ago I read an article asserting that Microsoft was essentially behaving like a middle-aged adult hanging onto adolescence. This article might have been on the Motley Fool site, I forget. The gist of it was this:
Companies typically innovate and take huge risks when they are young, because they have to in order to survive against their entrenched competition. Once a company becomes profitable and has a solid product line, it goes into the very different mode of repeating what it already knows how to do and improving itself. The focus is then on expanding market share, improving efficiency, making better financial deals and so forth. A company that succeeds at this phase accumulates a store of cash and starts focusing on things like mergers and acquisitions. By this time a company has evolved a complex management structure and a lot of rules and processes, which make everything the company does slower and more deliberate than before. These mature companies are much better at investing in other companies and leaving them to do the actual innovation.
Microsoft, the article said, had already entered the mature stage and yet was still trying to act like a startup. That was a couple years ago. Today I think we are seeing this view of Microsoft vindicated. Anything it does now is on a much vaster scale than when Windows 3.0 was released in 1990. Every big release now involves thousands of developers and millions of customers around the world. With a multi-year release cycle, Microsoft can't possibly respond to the market; they can only try to dictate to it. Everything they release was planned several years ago.
The statement that Microsoft has enough money to survive 5 years without any sales is an interesting bit of arithmetic, but that scenario is never going to happen. MS is a public company with thousands of stockholders, many of them large financial institutions. If Ballmer announced that Longhorn won't be ready until 2009 and will cost $30 billion, I doubt that the stockholders would let him or the existing board stay in place. There might even be talk of using that cash to buy a whole bunch of other companies and move away from doing actual development. Not that there's anything wrong with that. It would just mean Microsoft was finally acting its age.