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Where Microsoft's Profits Come From
derrida writes "Microsoft is the largest, most profitable software company in the world. In case you had any doubts about where Microsoft's profit comes from, there's nothing better than a graph to make all those numbers clear. As you may have guessed, the desktop division is quite profitable, while the online division is a money pit."
What I find most interesting is the way all changes are perfectly synchronized with the exception of entertainment related stuff. This is clear indication of the power of vendor lock-in and tying unrelated products together.
What I would find interesting is to know what events occurred during the valleys and rapid climb moments indicated in the graph. Specifically, what happened in Dec '06 and Sep '09?
It should be labeled "Where stupid people waste their money."
We look at the graph: MS is losing like 500Million per year on the Online Division
Then we look at the other graph and sees that Windows and Office has a 2Billion a year profit, EACH
And then we have to read crap like this: "We wonder when Microsoft will finally decide to do what it should have done years ago: Save its money and flush its entire online division down the drain."
No hon, SteveB is stupid, but not as stupid as you. It's called 'strategy', look it up. If it's working or not it's a whole different matter.
how long until
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And Google's cash cow is search advertising and loses money hand over fist on YouTube ($753m last year).
But where they do the worst, is where they have real competition, and where they do the best is where they have a sanctioned monoply.
Microsoft is the same company they were 20 years ago. Windows, Office, and Server software are how they make money.
Everything else under Balmer's tenure has been a (financial) failure.
Now, Balmer wants to spend the war chest to win the "search" war. I've just got one question for Steve:
Hey Steve, how much money did you make on the browser war?
This idiot wants to kill Google by spending tons of money on search, yet he has not explained how this will make Microsoft a single dime.
For Microsoft to grow and prosper in other areas, Steve Balmer needs to go.
-ted
After all these years... it's still Windows and Office. After all these years and new products. It's time to fire some executives. Microsoft apparently can't make money at anything new it does. Unlike Apple.
Do not spread "09 F9 11 02 9D 74 E3 5B D8 41 56 C5 63 56 88 C0" over the internet, thank you.
IANAL and IANAAC (american citizen), so i'm asking this to whoever is any...
can't shareholder sue microsoft's chief officers/board of directors for lost profits ?
I mean, 2 bil a year is money they could be paying as dividends, right ?
can someone clarify this to me ? thanks;
What ? Me, worry ?
They make their profit on their monopoly products and lose money on almost everything else. That is why the methods they use to maintain these monopolies continue to be the subject of antitrust investigations.
This also demonstrates that they are very good at maintaining their monopoly, but not so good at successful new product development. With a stagnant pipeline, they are especially at risk as FOSS alternatives like Linux, Firefox and OpenOffice become less "alternative" and more "maintstream".
in that they have a single-source of revenue. Discounting the pocket-change that they make elsewhere, take away google's ad revenue and they would cease to exist. Would the same be said of Windows and MS? Maybe Office or 360?
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The two most notorious months where we are subjected to those awful Microsoft advertising blitzkrieg's. Sept/Dec. That's when parents buy their young students a new laptop with MS OS included and gift them with a shiny new console for well,,, you know,,,study time. Then the students being somewhat more intelligent spend their money on beer and pot, so on mass reject any of the online crap that M$ tries to push. I see perfect sense in the charts.
Office and Windows have been their big profit centers for a long time. The big surprise there is that Office looks like it accounts for slightly more of their overall profit. And it was a surprise to see the margin on the server group. Back in the day I worked in a MSFT shop, it seemed like every day we were shelling out money for some license, another CAL or connector because the one we got didn't cover internet connections during a full moon, the support subscriptions that would regularly see large price increases, a piece of support software that was expiring. It was an every day thing that someone would come in and need money for something. Getting on without Windows servers is a blissful breeze in comparison.
You can argue the merits, but I find OpenOffice and GoogleDocs work for me. At home and the office. When we replaced Office with OpenOffice at the shop there weren't any complaints about the change. We did field a lot of calls about how to do stuff (mail merge), but there wasn't anyone crying for Microsoft leeks and onions. Although we didn't have anyone doing a lot of footnotes, either. If memory serves that's one feature of Word that pays for itself in a research setting.
That's our life, the big wheel of shit. - The Fat Man, Blue Tango Salvage
This graph impressed me.
It shows that Microsoft hasn't been significantly successful in diversifying the sources of its profits. MS Windows/Server tools aren't going anywhere soon. However, there are a number of alternative office suites out there, some low cost, that are user friendly. If a company with marketing intelligence and financial resources got behind one of them Microsoft could be in serious trouble.
How is OO.O not taking a bite out of their profits?
They're using their grammar skills there.
Microsoft has about $40 billion in cash. Surely interest income should be there somewhere, probably higher than Entertainment and Devices is on the graph.
Are you kidding? Office 2007 was such a radical change in UI that it took me about 3X longer to put together a simple document over the prior version. And just to keep everyone who's ever used the product on an even level with the intern who's been there 6 months, there's no "classic mode" button!
I understand product managers get tired of just fixing bugs, but there's a reason we don't change keyboards and paper sizes every 20 years. Imagine buying a pen or pencil that now required you to hold it parallel to the paper instead of perpendicular. That's basically what MS did in Office 2007.
"Well, good luck finding a judge that doesn't run a bestiality site."
What I find most interesting is the way all changes are perfectly synchronized with the exception of entertainment related stuff. This is clear indication of the power of vendor lock-in and tying unrelated products together.
That's one possibility. Another would be the economy itself. Maybe when things are good people buy more software so both go up at the same time.
Weaselmancer
rediculous.
What would you accuse them of?
Google Buzz, an add-on to Gmail that some have compared most closely to Sharepoint, one of Microsoft's enterprise tools.
Whiskey Tango Foxtrot, over?
Sharepoint is like a corporate wiki. It's got more in common with Google Wave... in fact Wave is like a cross between Sharepoint and OneNote.
I noticed one difference between Access XP and Access 2003. They apparently added data dictionary triggers, so if you changed a field name or table name in a database, it automatically updated views and forms and reports based on that table. I thought that was pretty cool.
When you sympathize with stupidity, you start thinking like an idiot.
And yet, a decade without innovation seems to have cost Microsoft nothing in terms of their core markets, and their experimental markets seem to be flat. Almost as if they are trying to push the market in a direction the market knows better than to follow.
What a surprise. If you want to sell an Office or Operation System the first thing your customers will ask you, how good does it support Microsoft Office file format or how good will my Windows only applications running.
It's good to have an almost monopoly, you just need to polish your old applications, make the binary formats slightly incompatible, so if some important person buys the new one, everyone else must upgrade, too.
I mean, what choice do customers have? It's either Windows 7 Starter or Windows 7 Home Basic or an Mac in the Apple Store.
Every school in the western world is teaching only Windows and Office. Microsoft is not a company, it's an institution. Every Computer vendor in this world have to support Windows and all the big ones are promoting Windows with everything they have. Just try to get a new Computer, everyone will have a "Xxx recommends Windows 7" and if Microsoft will have a new Windows 8, every big vendor will put a "Xxx recommends Windows 8", regardless of any quality.
For MS and the vendors it's a win/win situation. Microsoft have ads and it sells Windows, as well as other products that are build on top of Windows. The vendors get the Windows copy for free (or almost for free).
Just try and implement and sell a new system or office suite. The entry line to this market is like enter in the tourist space market or to colonize a new planet. But a system or an office suite are very simple applications. You need some know-how, but it's not rocket science.
http://www.mueller-public.de - My site http://www.anr-institute.com/ - Advanced Natural Research Institute
then why isn't it better?
What would really be interesting is see a comparison of profits from their OS division to their gaming division. Gaming is a huge industry and the Xbox is fairly popular. I would not be surprised if the gaming division kept up with the OS division but I can imagine the profit margin is lower for each game/console sold.
Recently I came across Guy Kawasaki's lectures. In one of them he mentioned, back in the 80s when he was a Mac-Evangelist, Macintosh department employees were given world class treatment like professional massage treatments during working days, First Class air tickets if the flight is 2+ hours etc.
But in reality, Macintosh wasn't earning a dime and continuing the spending spree of all what Apple II department was earning. In return, not a single Apple II employee was permitted to enter the Macintosh building.
I observe some similarity here in Microsoft too (i.e. one department earns, other spends). But seems it is not that bad.
In my humble opinion, I predict the demise of Office and Windows OS in next 10 years (maybe there will be cloud versions). I believe Microsoft will move into more enterprise/back-end technology space rather than remaining in desktop/consumer space (just like IBM). But nothing can be predicted to a higher accuracy, as the internet backbone is yet to achieve higher bandwidths and reliability, which is somewhat mandatory before a full migration in to a cloud based software eco-system.
One year they have vast amounts of money, think they own the world. 10 years later, their cash is being spent on a dozen failures which they can't own up to and then, suddenly someone makes their core monopoly irrelevant.
It takes years, possibly decades for them to stop moving but it happens.
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The “article” does not contain a single info on where the data actually comes from. (Or have I missed it?)
Which makes it impossible to determine, if it is legit, or fake.
I also never heard of “businessinsider.com”, which means that they don’t have acquired any trust credit.
So there is really only one thing to do: Ignore the graph.
And give a negative credit to them, for failing to give credit (by|/) offer(ing) a source.
Any sufficiently advanced intelligence is indistinguishable from stupidity.
When Alaren said it hadn't "changed meaningfully", I don't think he meant that it hadn't changed at all. It's been standard operating procedure with Microsoft to reskin Windows and Office with each release, shuffle around all of the buttons and controls, etc. It's always the case that some people like the changes and some people don't. Some people really like the Office 2007 UI.
I think the idea was that they haven't significantly added much to Office's functionality or drastically changed the way we work on Office files. To be fair, that's a tall order. It's hard to make drastic changes to something that works well and that people are relying on. On the other hand, they had billions of dollars and 12 years to work on it.
It does seem like maybe they're starting to make some real efforts now, which seems like a good change. The fact that Exchange 2010 has webmail support for browsers other than IE; it seems like a good sign.
Over the total lifetime of the division, what is the net profit of the "Entertainment and Devices" department? How much has Online cost, total? And what has it positioned them to do in the long run?
Well sometimes there is a sort of "halo effect". The XBox may be helping keep both developers and gamers on Windows, which would justify even substantial losses. Online service might not be making money in itself, but it might be worth it to them just to keep people away from Google.
On the other hand, I've also had a lot of times where I wonder what the hell Microsoft is doing. They often seem content to dump money into R&D while refusing to turn any of it into decent products. Meanwhile they seem intent on maintaining their userbase through lock-in rather than customer satisfaction. Honestly, there are times when I think Microsoft executives are sitting in a room somewhere saying, "Who gives a crap if anyone likes this product?! We'll just make sure they have to buy it whether they like it or not."
The "article" does not contain a single info on where the data actually comes from.
It's public information, from Microsoft's 10Q filings with the SEC. See Note 17, "Segment revenue and operating income".
I'd known that the whole XBox operation was struggling to break even, but I hadn't looked at the numbers for the online sector in a few years. They're losing big in that area.
Note that the Windows Division includes "Windows Live", which includes Hotmail and Messenger. "Online services" is the ad-supported part of the operation, including Bing and MSN portals, plus Microsoft's dying dial-up service, Microsoft Access. Ad revenue is way down for Q4 2009: "Online advertising revenue decreased $32 million or 3%, to $934 million, primarily reflecting a decrease in display advertising and advertiser and publisher tools revenue."
If their online "profits" are any indicator, we'll see where the rest of their profits go as we all slip further and further into cloud computing. The rise in popularity of Mac OS and other alternate platforms make the "switch" pretty easy these days.
Here's your classic mode:
http://www.kingsoftresearch.com/KSOScreenIms.aspx :)
Open Office has a long way to go before it's really a big threat.
-1 overrated is not a substitute for "I disagree". I know the main groupthink here is "Microsoft is always wrong/evil/bad/etc." However true that may be, let's not begin the argument with bullshitting ourselves.
OP posted a conclusion that I thought was recklessly summed up. It's easy to come up with other notions on how this graph could look the way it does - I posted one.
If you disagree, fine. Post something that refutes my argument. A good starting point would be to look up Apple's revenue and see if it tracks with MS. If they track together, that's evidence of a common cause which would back up my argument. If they stray, then that would argue that the economy may not be the common cause.
It's lazy to use your mod points as a way to bury your head in the sand though. So stop it, please. Let's seek the truth no matter what it may be. Then we'll be able to proceed on solid ground, rather than simply jerking off to groupthink.
Weaselmancer
rediculous.
Apparently, you are not a Excel user.
Try copy/pasting your post above into an Office '97 Excel cell and see what happens.
Option to do something like that correctly wasn't added until the 2007 edition.
Why?
Was it because Microsoft is an evil heartless corporation that intentionally chokes and cripples their own applications just so they can keep selling you another version WITH those options a few years down the road?
Or could it have something to do with available processing power and memory on an average PC in '97, 2000, 2003 and 2007?
Also, if you find Office '97 a paragon of text and statistical data editing, publishing and presenting... You need to get out more.
Mit der Dummheit kämpfen Götter selbst vergebens
The graph provides no insight into how costs are allocated and determined across MS. Without an understanding of costing it's hard to say anything about product profitability; except that MS made a lot of money overall.
I'm a consultant - I convert gibberish into cash-flow.
I like their mice.
That's about it however.
I am very small, utmostly microscopic.
What is this "Windows" label on the region of the graph where "white collar crime" is supposed to go?
I'll go on the record as preferring the ribbon to the menu.
the first thing your customers will ask you, how good does it support Microsoft Office file format or how good will my Windows only applications running
"How good?" Where the heck are your customers, in West Virginia?
Just like it was under Billy Gates. The company didn't suddenly start sucking with fat monkeyboy. It has always sucked.
Microsoft has been the "New SCO" since before SCO. Billy saw the red ink and bailed. Enron-style creative accounting can only keep fools fooled for so long. Eventually they are so broke no amount of diddling can hid the losses and then top executives have to be let go for lack of funds.
As always, you forget Business is War.
Just think how much would the alternative cost Microsoft in the long run.
You don't just do stuff to gain profit, you do everything to keep the competition from catching up. If you can keep (incompetent) domination of a sector at a 5% loss, you're better off if you allow a competent competitor to gain this domination (and earn lots), and then let them use their profits to dominate you in domains where you profit.
45 5F E1 04 22 CA 29 C4 93 3F 95 05 2B 79 2A B2
One point that has been missed so far in this discussion, IMHO, is that Microsoft's substantial Windows and Office revenues are not entirely disconnected from the addon effects of satellite products and services which help to preserve and enhance the profitability of the core franchises; even though individually those satellite products in services might only break even or even lose money. For example, do you believe that Microsoft Office would be nearly as valuable as it is today without the integration with SharePoint and other Microsoft products and business servers? A substantial part of the value proposition of Microsoft is in this "ecosystem" of products and servers which work well together in an enterprise setting ala Voltron or, if you like, the Borg.
Maybe you heard of it - it's when a lot of people buy new PCs ... and new PCs all have copies of Windows preinstalled.
No sig today...
How the heck are you trying to correct the parent with fucked-up English?!
It's LOSING, not 'loosing', you stupid motherfucker.
And QUARTER, not 'quoter'.
Go back to fucking grade school.
yeah, the Xbox may be more about keeping Sony off-balance and preventing Sony from attacking Microsofts core business. There's nothing stopping Sony from selling PS3's with Linux pre-installed and throwing a copy of "Linux for Windows users" in the box. All they'd have to do is put OtherOS support back in the Slim or bring back the Phats. And that would be a threat to Microsofts dominance in the OS for "home computer" markets. Microsoft helped kill Commodore by saying, "you might need to bring work home from the office and you can't do that on a commodore, you need a DOS machine."
Microsoft knows that most home users, don't, need to bring work home from the office. They don't need Microsoft Office compatibility. In fact, they don't need Office at all. And if they don't need Office, they don't need Windows and could use alternative operating systems. Maybe they don't even need a computer at all but some kind of souped up set top box/game console with a web browser good enough for Gmail and google docs.
That may be why the Xbox doesn't have a web browser, they don't want people to realize that they can do a heck of a lot of stuff on the net, without a computer running windows.
I'm going to make the horrible patriotic arguments that people around here hate, but... well here goes.
I'm actually really glad that one of the major game consoles is made by an American company again, and puts out almost entirely games aimed for an American audience. Before the Xbox came out, every console RPG involved metrosexuals with 12-foot-long swords, the Xbox instantly changed that from day 1 with Morrowind. Before the Xbox, virtually all shooters were third-person, I can't stand those games.
It doesn't hurt that both the original Xbox and Xbox 360 are *excellent* systems that both Sony and Nintendo are scrambling to catch up to. (Software-wise.)
Seriously, an American company hasn't had much of a say in console gaming since the freakin' Atari in 1983. What's happening now in the market is good and healthy, and even if Microsoft is losing money, I love them for it.
Now please mod me down for being too American and supporting Microsoft.
Comment of the year
Particularly telling is the lack of profit from Bing. Propagandists like to swagger about how 'successful' Bing is. But DARN! No profit!
It works like this: Blow advertising dollars for months on end promoting a product, and it will gain market share. But will it gain actual profit? Let's watch what happens when MS stop the advertising bucks.
Darn again! More swagger about how successful the XBox is. But where oh where are the profits?
Here's how it works: You buy your way into a market and knock out all the competition with loads of spend, spend, spend to promote your product and buy game developers and sell your hardware for less than cost, and eat all the costs from over 50% hardware failure (yes, entirely true!) and in the end, after all the carnage to your competitors, WHERE ARE THE PROFITS? Oh. That sucks.
But Office hasn't changed meaningfully in 6-12 years--sure there are new features that some folks like, but when I switched from WordPerfect 5.1 to Office 97 (?) that was the last time I noticed a significant change in feature set and usability. And the Windows OS has had a lot of changes under the hood, but XP to Windows 7 is much the same progression as Office 97 to Office 2007--security and cosmetics but no real innovation.
Can you define what you mean by "innovation" ? Examples would be best.
Then we look at the other graph and sees that Windows and Office has a 2Billion a year profit, EACH
That other chart shows profit for each quarter.
Gosh, I would have thought that the Baby Roasting and Bayonetting business would have shown up more clearly.
Any sufficiently advanced technology is insufficiently documented.
who cares what corporates use if they want to use crappy exploitable garbage let them
the stacked line chart is one of the worst ways of presenting data
perfect for MS
Citizen Kane anyone? They can afford to lose money there as long as they please, and they've got good reasons to. Some things are more important than maximising next quarter's profits.
You just got troll'd!
The refund i got from Acer for the windows 7 license i rejected last week will show on that chart next quarter i'm sure. if given with better resolution.
What simple features took you that long to relearn?
Windows, Office, and Server will eventually be replaced with Linux someday...
"Really, I'm not out to destroy Microsoft. That will just be a completely unintentional side effect" -Linus
The sad part is that the kernel alone wont replace Windows. We still need to fix GNOME into something
non-bloated and good enough that most will agree on it beeing 'the GUI for Linux' . KDE and most
WindowManagers are very nice but they dont fill that gap.
A fully working replacement for ActiveDirectory is also required. Or am i missing something obvious?
And a little more work on Wine.
With these three in place i dont see any reason for n00bs nor organizations nor me to loose any more
money to Microsoft.
Im not sopsa but I am intrigued by your offer.
What simple features took you that long to relearn?
Auto-rant.
Irony: Agile development has too much intertia to be abandoned now.
Gaming is a huge industry and the Xbox is fairly popular.
The console and PC game industry as a whole was worth $20 billion in 2007. Electronic Arts: Lost in an Alien Landscape Microsoft raked in $19 billion in revenues in its last quarter.
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After all these years... it's still Windows and Office.
It's the Windows, Office and Server divisions.
Think of SharePoint as the jack-of-all-trades in the business software realm. Companies use it to create Web sites and then manage content for those sites. It can help workers collaborate on projects and documents. And it has a variety of corporate search and business intelligence tools too.
Microsoft wraps all of this software up into a package and sells the bundle at a reasonable price. In fact, the total cost of the bundle often comes in below what specialist companies would charge for a single application in, say, the business intelligence or corporate search fields.
Microsoft declines to break out the exact sales figures for the software but said that SharePoint broke the $1 billion revenue mark last year and continued to rise past that total this year, making it the hottest selling server-side product ever for the company.
Crucially, Microsoft has found a way to create ties between SharePoint and its more traditional products like Office and Exchange. Companies can tweak Office documents through SharePoint and receive information like whether a worker is online or not through tools in Exchange. These links have Microsoft carrying along its old-line software as it builds a more Internet-focused software line.
"SharePoint is saving Microsoft's Office business even as it paves the way for a new era of Microsoft lock-in," said Matt Asay, an executive at Alfresco, which makes an open-source content management system. "It is simultaneously the most interesting and dangerous Microsoft technology, and has largely caught its competitors napping."
Microsoft's SharePoint Thrives in the Recession [August 7, 2009]
Isn't 2007 the one with the ribbon that no one can use? Doesn't that make it a new product, the fact that no one knows how to use it anymore?
Someone seems to know how to use it: Bestsellers in Software
#5 Office Home & Student 2007. 1147 days in the top 100.
You are correct. I look at several dozen economic graphs a day, and this graph is just stupid. In fact, this is as far as I am going to read in this thread, it ain't worth it. Basically, everyone knows that office and their vendor locked in with new computer sales operating system is where MS makes their money. Both of those incomes are in peril now as we have hit a plateau of actual functionality and productivity gains with the older versions of their software. Any "advantages" to expensive upgrades are minimal to nothing. There is no overwhelming advantage anymore to upgrade to any of MS newer offerings. Hence, ergo and therefore, they have hit peak as a corporation unless they do something radically different, and will start to go down the poop chute now.
Oh yes, fanboys will contend that all these businesses "have" to use MS, etc. Well yes, I believe those fanboys are talking about all these other failed or soon to fail western businesses, who make bad decision after bad decision and are existing now primarily by offshoring and cannibalizing their own corporations, and spending money on useless crap, like MS "upgrades" and never ending PHB meetings, etc. They are throwing good money after bad at this point, and rewarding all the higher level execs with ridiculous compensation packages for their "astute" business sense.
Most of them are toast as well. Hardly any of them can analyze or look at situations more than a few months out it appears.
We haven't near hit peak bottom of the economic downturn yet, not even close. It's going to get ugly. The negative leverage, and yes leverage can work either way, is simply off the charts, so to speak.
I don't hold any, but if I did, and this isn't advice, just saying what I would do, I would offload any MS shares to any sucker who wanted them now. MS today is the GM of a few years ago..still looked impressive, wow, look at all those big numbers, all those zeros....but the fundamentals had stopped being "fun", and the vast herd of shareholders, plus the top GM management couldn't see it.
If you can think past the next quarter, you'll always do well in economics, whichever direction you go in. MS is existing on inertia now, and past glory, nothing else. There will be one more go-around of a lot of companies upgrading their hardware and software, and once they run the numbers and find out all that expense did was cost them money, that they didn't gain any productive benefit from it, then that's it, MS starts a real fast decline at that point.
I suspect I know what you're driving at, but would you care to frame it less rhetorically? I'm disinclined to launch skeet for you, but I'm happy to discuss your objections should you desire to actually voice them.
You appear to be criticising a lack of innovation. I want to understand what qualifies as "innovation" to you, so I know whether your criticism is reasonable, or standard Slashdot anti-Microsoft rhetoric.
But a system or an office suite are very simple applications. You need some know-how, but it's not rocket science.
There is nothing simple about an OS or an office suite.
In 2003-2004 OpenOffice.org had reached 9 to 12 million lines of code. Build FAQ for OpenOffice.org. OpenOffice.org statcvs (Lines of code)
Microsoft spends an enormous amount of time and money on studies of office work and the office worker. That is why it can take a chance on something like the ribbon and win - and why competitors like OpenOffice.org are left playing catch-up.
AAPL's market cap depends on iPhone for 49% and Macintosh for 23%, meaning two major products make up 73% of the company. GOOG depends on search ads for 63% and nexus one is 9%, meaning 72% of company depends on two products.
MSFT is even more diversified, Windows is 37% of market cap and office is 30%, meaning 67% of their market cap comes from two products. This makes it slightly more diversed that AAPL (73%) and GOOG (72%).
Online services are now the third largest division of MSFT. It represents 7.7%. Windows/SQL Server division is 7.5% and Xbox/Zune is 3.2%. The remaining of it comes from their cash 13.6%.
What's wrong with "How good"? Is it "How well"? My first language is German not English.
http://www.mueller-public.de - My site http://www.anr-institute.com/ - Advanced Natural Research Institute
Wow 9 to 12 Million SLOC. Do anyone have a statistic of with module of OO.org have how many SLOC and how complex it is?
The Linux Kernel with all the drivers have 12.6 Million SLOC. How is it possible that an Office Suite have more that the whole kernel+drivers?
For the spend money and time I'm not very impressed with Office. My impression is, it's the same as the first Office Suite, a pretty dump text editor with some extra tags to get some format and buttons for the tags. I really don't know why they need to have so much SLOC. The same goes for Excel, Presentation and Database. Very simple applications.
Now with Latex I'm really impressed. A very intelligent piece of software, that really do the work for you, instead that you always fight for the right format.
http://www.mueller-public.de - My site http://www.anr-institute.com/ - Advanced Natural Research Institute
You think like a ReThuglican Jew
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The oil companies and walmart make much more.
This isn't correct.
They are muxing their online services and their xbox 360 hardware.
They are making a profit on Xbox Live, unlike the chart is showing them losing money on it.
Be seeing you...
As much as I detest MS, but in fairness to their R&D...well....R&D in general...it does not need to translate into new products. It needs to get translated into products even if those products are currently existing and the R&D is simply streamlining them or making them better in some way. Those kinds of improvements will be off the radar to most end users. It isn't clear that MS is doing this but I expect some of it must be happening.
That said, MS probably has the problems many big companies have with R&D, any genuinely new idea for a new product will be seen as a threat by Business School Product running the company. They will marshal their forces to defend any current products by claiming the new product will cannibalize their old products. And that may very well be the case but the result is the tired lineup of products that MS is currently pimping.
Microsoft reorganized their business multiples times in the past. I wonder if these reorganisations disturb the numbers from the graph. IIRC Hotmail was in the online division some years ago, now it seems to be reported in the Office division. I remember similiar things for their server OSs (were Office, now seem to be Windows), their embedded OS (where is it now? Entertainment or Windows?), the xbox etc.
Microsoft has a bunch of products that don't make money or at worse loose a lot of money. On the other side they have some products (Windows 7 (incl. Server) and Office) that are cash cows like nothing else on this planet. Microsoft seems to be quite eager at mixing these parts. So that Microssofts customers can't see their extreme margins on Office and Windows (which are 95% plus) and their shareholders won't complain about Microsofts many lossmaking products (everything online, embedded Windows (whatever it's called today), xbox, ...)
-- "As a human being I claim the right to be widely inconsistent", John Peel
Microsoft is lucky smart, entrepreneurial software engineers are focusing so heavily on web crap because of the visibility of Google and Youtube. Basic enterprise software (word processing, spreadsheets, even a refresh of Linux that actually works for once) could really start hitting MS where it hurts if some capital was pumped into addressing the enterprise-specific problems current offerings still have.