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Microsoft Is a Dying Consumer Brand
Taxman415a noted a CNN story on the dying Microsoft brand where they talk about "The less than stellar performance of, and problems in, nearly every consumer division. It cites StatCounter's data showing IE's market share falling below 50%, and is even smart enough to note that's just one statistic with various problems, though the trend is clear. It also seems that MS doesn't want to compete with Android, so it plans to charge royalty fees to handset makers to discourage them from using it in their products. The conclusion is that MS will just be a commercial, not consumer company."
Microsoft has been late to the game in crucial modern technologies like mobile, search, media, gaming and tablets.
Microsoft was doing tablets (since 2002!) and mobile long before Apple kicked out the iPhone and the iPad (yes, I'm aware of the Newton, but it wasn't directly involved in the successes of the recent mobile efforts).
Just because they haven't been doing it right doesn't mean they haven't been doing it.
I'm sure many phone makers are very happy with the fact that MS charges royalties for Windows Phone 7. This is because MS will be the one defending any IP/patent lawsuits, etc. Why do you think people are suing HTC and other Android phone makers instead of Google? Google probably isn't legally responsible. MS will be, so they are charging a small amount for it.
Their money makers are windows, xbox, office etc.. none of which are mentioned in the article.
Microsoft has an incredibly great balance sheet and is making shitloads of money, and that's good news.
The bad news is that Redmond has developed a nasty habit of releasing incremental improvements and lackluster copies of what the competition is doing.
It's not that what they sell is bad, Windows Seven is actually a very good operating system (and this is said by someone who switched to Ubuntu, but I still see enough Windows Seven to like what I see). The xbox obviously gets great reviews (I'm not a game machine owner, so I can't judge for myself). Windows phones have always had a good reputation as decent phones. Hell, you can have my Microsoft Natural Keyboard when you pry it from my cold, dead, grateful-not-to-have-needed-carpal-tunnel-surgery hands. Microsoft makes some really good stuff.
The problem with Microsoft is that they aren't trying to make brand new stuff any more, and their copies of others' work has become really lackluster. Windows Seven is great, but set Windows 2000 next to Windows Seven and tell me there's 10 years of significant innovation there. Tell me how many revolutions that product has gone through since they dumped the 95/98/ME kernel. No, I'll tell you. Zero. Nada. Zip. It doesn't make Seven BAD, it just makes it BORING.
Where are they in social networking? Where are they on mobile stuff? Search? Bing? Really? Where's my Microsoft Flying Car? Why am I carrying a cell phone at all? Where's my glasses with a heads-up display, eye tracking, and an earpiece built into the wing? What is Microsoft Labs working on? Oh, right, a ribbon interface for Office, a poor clone of Google, and an update to Windows CE. Yawn. Snore.
That's how the market works, if you don't come out with something that makes people go "WOW!" every now and then, you're dying. That doesn't mean bankruptcy is imminent or your shareholders should be concerned about not making a dividend 3 years from now. It just means that you aren't a leader any more, and you need to get off those laurels before they leave a permanent mark on your ass. Because once people start looking to others for new stuff, they'll start drifting away from you on your cash cow products.
"This post contains words, known to the State of California to cause thought. Wash brain thoroughly after reading."
Get off my la.. bah. Nap time.
Microsoft just doesn't make my blood boil the way they used to. Sure, I still hate them out of habit, but I'm old and tired now. I feel like a bed-ridden, old and gray, Elmer Fudd who still mumbles that he "could have had that wascilly wabbit', but in reality doesn't really care and just wants you to leave him alone so he can watch Diagnosis Murder.
That fact alone is a bad sign for Microsoft. They just don't matter in the same way they used to and they certainly don't drive Technology the way they did in the past few decades. Their tactics are less of a threat than they used to be. Sure, they'd do evil if they could, but they are just fruit flies at my picnic, and I've got my eyes peeled for bears.
No no no. I plan on stepping aside and enjoying my Golden Years while the next generation shakes their fists at their Apples and Googles and Facebooks.
I was thinking the same, but look at the video of the interview on the TFA page and look closely at their faces. Balmer seems defeated. His posture is slumped, he mostly says Win Phone is "different," and you can see contempt in the bitchy reporter's face -- when she talks about her experience with Win Phone, when she mentions Bing, when she barks at him telling him "Explain this" and so on. And all the while he only tries to be attentive, smiling, and upbeat. Even the article ridicules him as struggling with the "vision thing."
That's not a sign of a company doing well. But I think it's just a phase, and that they will eventually reposition themselves not as a consumer brand, but as a company that enables you to get things done.
Windows is like the sick old man of Europe.
It may be a zombie but it will probably outlive all of it's contemporary commercial competitors.
A Pirate and a Puritan look the same on a balance sheet.
I think 'potential' in the poster's context could be infinite. Such are optimists.
And reality, the potential is near zero, and will remain near zero. Microsoft has lots this, and numerous other values. Hence what Ray Ozzie connoted when he left with an exit memo that ought to shake Wall Street into a regime change in Redmond.
Microsoft's oil well, the Windows Franchise, is losing steam, and steadily. That's the crux of CNN's observation. I agree with them, and the inflection point was Windows Vista, and the denial that open source and Steve Jobs could do it better. Maybe the PC isn't dead, it's just one more device. Microsoft doesn't understand this, and the incestuous products they make, coupled with a not-invented-here mentality means their distant and certain future death if they don't wake up.
---- Teach Peace. It's Cheaper Than War.
That's exactly the point the article makes. The part of my submission that Taco trimmed out for space was that I don't really mind if MS mints money in selling to commercial markets, because what this article is evidence of is that for MS to continue making money they are going to have to compete on quality. That's been my only major beef with MS products over the years: you were almost forced to use their products even though they were terrible in most cases. Now that there are significant competitors in the mobile space and that market is growing, and Apple, and to some extent open source and even perhaps eventually Google Chrome are providing competition on the desktop or making it irrelevant, I don't really care if MS grabs say 30% of the mobile market. Because to do so, they'll have to put out a really good product. Same goes for commercial applications and servers. There's fierce competition there and Linux is doing well. If they make a lot of money still, then great, they just won't be able to subvert markets and consumers and businesses will be better off for it.
Courier, slate, RROD, Zune, Vista. Failures abound, then Apple passed them by. The "flyover" states are indeed buying lots and lots of iPhones and iPods, and now iPads. I don't like them myself, but the proof is in the pudding. MS is a dying brand, if they don't turn it around and start to think (sorry) different. Not "just like Apple" I mean different, as in get some real ideas and stop focusing on the now declining bottom-line. Bean-counters don't make good software engineers, still you have to win on both sides of the house. Sorry, MS is just an over-sized company that might not be able to maneuver through this new world like a smaller, or more nimble thinking companies do. I'm no Apple fan anymore, MS may not want to follow the leader here either. Innovation is a mystery to them. Period.
This is the NSA, we're gonna geet U h@x0r5! Also, what is a h@x0r5?
And before digital photography came along, Kodak was insanely profitable. There are disruptive technologies all around Microsoft. At this point, they should be disrupting themselves, but like IBM 30 years ago, they are going to have an awfully difficult time doing so.
True, but don't forget that Apple, Android, and even WebOS have a several-year head start on Microsoft in the mobile space.
Several years.
That's a lot of lost ground to recapture before you can even begin to overtake any of them.
Zune was DoA. Kin was DoA. Courier was vaporware. XBox 360 bet heavily on HD-DVD, and lost.
Was Vista part of the "getting better" process? IE6 stagnated for years until they were forced to begin upgrades again by Firefox. WP7 is several years behind its competitors, and for all its promise, it still has to make up that lag if it wants to seriously compete.
This is not to say that MSFT is a 'dead' or 'dying' company. But they've gotten complacent as the 800-pound gorilla, and other companies are capitalizing on their inability to adapt & move quickly, and in many cases, beating the pants off them. I think Microsoft's success is far from guaranteed, and it's clear that they are mostly in a reactive mode, rather than an "innovate & open new markets" mode -- they're *responding* to Apple & Android tablets. They're *responding* to Apple and Android phones. They're *responding* to the iPod. They're *responding* to other gaming consoles, other browsers, other search engines, other social networks. And every misstep they make, you can bet one of their competitors will capitalize on it.
If they don't get out of that reactive mode, they will slide towards irrelevance, and end up a "me too" brand on the market. It's not that MSFT is a "bad" company - they have a lot of bright people working there. But I don't think management has a clear strategic vision for the company, and it shows in the clear "nobody will take this segment seriously until there's a *MICROSOFT* product there" attitudes that Ballmer et. al convey. Nobody was going to take the iPhone seriously. Nobody was going to take the iPad seriously. Nobody would want an iPod once Zune was available. That's coasting, not leading.
MS is a large company that does not react quickly. They have skilled people but are hampered by management. One of the reasons the Kin failed was that it was 18 months late. It was decisions by management that caused problems. The original idea was they wanted to quickly release a product. If MS had tried to build one from scratch it would have taken years. Thus MS bought Danger. Danger made the HipTop (commonly known as the SideKick) and the original plan was to release a SideKick successor within 6 months.
[Now all of the following are rumors as no one in MS has officially confirmed them. You can read about them by googling.]
But then came the management decisions that would doom it. SideKick applications ran on Java. Being MS, it was decided that Windows CE would be used. That decision alone would push back product launch by many months. There was also rumors of infighting. The head of Windows Mobile didn't want the Kin so he did not allocate any resources to help the Kin team (Project Pink). So the team had to implement an OS with which they were not familiar without the help of those that knew the OS well.
As the project became hopelessly delayed, features like the App store were cut in order to make some sort of release date. Also since the phone was so delayed, it was going to be obsolete by the time it would have been released as many of the competing products released new features in the meantime and the market place was changing. When the SideKick was popular among teens, texting with some photosharing were the functions that they used most. But by the time the Kin was released, consumer smartphones like iPhone and Android that did more than text were becoming the desired products.
In the original plan, Verizon wanted to woo these texting teenagers as customers from T-Mobile. So they were willing to offer a cheap data plan. By the time the Kin was launched, the phone itself would consume more data than originally planned (texting phone vs smartphone). Verizon did not feel they needed to honor the original agreement as MS delivered 18 months late. Thus the Kin got the normal smartphone rate. The combination of late, few features, and high data plan would make the Kin not desired by the target market.
Well, there's spam egg sausage and spam, that's not got much spam in it.