Did Microsoft Alter Windows Sales Figures?

Saxophonist writes "InformationWeek claims to have analyzed Microsoft's most recent Form 10-Q and observed that a reported increase in earnings for the Windows unit may be due to accounting trickery rather than actual sales growth. Microsoft apparently increased its reported revenues for its Windows, Server & Tools, and Office units at least partly through shifting revenues from other units. While there may be nothing 'to suggest the company's revisions violate any accounting rules,' the actual growth in Windows sales was likely nowhere near the high double-digit percentage growth claimed. InformationWeek speculates that revenues from Xbox and Surface may have been among the revenues shifted to the other divisions."

Comments

SOP?

[Nidi62]

I thought pretty much every publicly traded company did stuff like this?

Re:SOP?

[UnknowingFool]

http://www.fiercemobilecontent.com/story/itunes-now-70-digital-music-sales-amazon-growing/2010-05-27 I know this is kind of an old link but 70% of the market qualifies as monolopy. Plus the fact that they are about 30% of all music sold in the us every month.

Monopoly does not mean highest marketshare. Marketshare is only one test of monopoly power. One of the other tests of monopoly power is whether you can get suitable alternatives. Another test is barrier to entry.

In the case of music, iTunes is not the only source of music. You can buy music by buying CDs through brick and mortar as well as online sales. Even if you limit the market to online music, you can get music through iTunes, Amazon, Zune Marketplace, etc. The only limitation is that you have to get music in a compatible format with your player. Since AAC or MP3 can be played by many players (and isn't controlled by Apple) there are alternatives.

Secondly, if you didn't have alternatives to iTunes could any company launch an alternative without significant barrier to entry. Both Amazon and MS did after iTunes was launched. The real barriers to entry are approval of the RIAA companies which is not within Apple's control and money to build your web store.

They are even under a DOJ invistigation. http://topnews.us/content/221070-apple-under-doj-investigation also kind of an old link.

From what I know about the situation, Apple did not like it when they heard that Amazon was going to get exclusive content from the record companies.

Stone cited "people briefed on the inquires," who said investigators have been particularly interested in allegations that Apple used its market power to seek to prevent the labels from participating in exclusive music distribution deals with rival Amazon.

My reading of that is Apple was trying to prevent exclusivity. They did not prevent Amazon from getting content but rather exclusivity of the content. Slight difference.

Then they are trying to dictate other stuff, like the whole thing with flash. IMHO if the DOJ is investigationg you for anti-trust laws, then your pretty much a monolopy or on the verge of becomeing one.

There's a difference between what Apple has done with Flash and what MS did (which is the counterpoint). Apple has dictated that their own players will not use Flash. Apple has not dictated what Android or MS does with Flash. MS told Intel not develop a Java VM or MS would "favor" AMD in their next version of Windows.

Also investigation != conviction. Not every investigation leads to charges or conviction. Sometimes the investigation is settled or even dropped.

Company released sales figures

[falldeaf]

I always mentally put these parts of the slashdot poll disclaimer in front of sales figures released by *any* company: "This whole thing is wildly innacurate ... If you're using these numbers to do anything important, you're insane."

Re:Company released sales figures

[ByOhTek]

maybe, but how many companies have "Cowboy Neil" in their sales figures?

Re:Company released sales figures

[FriendlyPrimate]

And when the company does finally collapse, the people who were responsible for the creative accounting are long gone doing the same thing to another company.

I tend to believe in the power of capitalism. But what I've seen lately is not just capitalism...it's pure greed. It's an economy run by narcissists who care of nothing else but their own personal pocketbooks. The company, the workers, the investors....it means nothing to them other than a means to an end. And we worship these people. And on the flip side, the people who actually produce the wealth in this country get castigated for being greedy because they want above-poverty-level wages.

Re:Company released sales figures

[Anonymous Coward]

Yeah, that's how capitalism works. It's all about greed; if people can live without being greedy, then it's not capitalism. Supposedly that greed is what provides the incentive to serve society, as opposed to communism where we rely on automatic intrinsic motivation (e.g. you write software for the community because you like programming or want something to work instead of for money). The problem people fail to realize is that when someone is that self-serving and greedy, like they're supposed to be, they're going to pull these kinds of stunts instead of providing any kind of benefit to society as if there were some kind of competitive free market race.

Re:the truth!

[AdmiralXyz]

But see, that's the beauty of corporate accounting. They never actually lie, it's all a matter of classifying revenue sources and sinks in brain-twisting ways that are technically accurate, even though from a bird's-eye view they give a completely mistaken impression of what's going on.

And this isn't consigned to Microsoft, like an above commenter said, every Fortune 500 company has done it to varying extents. It's difficult to make illegal, too, because there's no one technique used (seems to be as much an art as it is a science, finding loopholes that aren't closed); so it's impossible to write a law that's general enough to stop the practice yet still enforceable.

Re:Shuffling deck chairs on the Titanic?

[Toe, The]

I think it's turning out more like shuffling governors in the Ottoman or British Empires. A slow, gradual, slightly-pathetic decline as one setback overshadows another.

Is any huge corporation completely honest?

[digitaldc]

Actual sales versus paper sales...Microsoft is a huge profitable corporation so WHO CARES?

Is CmdrTaco a Pedophile?

[TheRaven64]

Am I the only person who hates these allegation-disguised-as-a-question headlines? Please can we stop posting them? If you're going to make an allegation, make an allegation, don't try to pretend that you're asking the audience for their opinions. If you can't back them up, don't make the allegations, and if you can then don't hide behind weasel words in the headline.

Re:Is CmdrTaco a Pedophile?

[SiChemist]

The story headline was "Exclusive: Microsoft Altered Windows Sales Numbers". I take the slashdot headline as questioning whether the story is completely accurate. Your beef appears to be with the story headline.

Re:the truth!

[maxume]

The Information Week story is quoting from an SEC filing that Microsoft made. A filing Microsoft knows is public. So Information Week didn't exactly bust anything open here, and you just have to decide if you care about Microsoft's results on a segment by segment basis, or if you are happy owning the company in general.

Re:Yes

[hsmith]

Well look at it this way - they aren't fudging their balance sheets as bad as the US Government

Re:The Surface has revenue to shuffle?

[UnknowingFool]

How does WP7 look good? Besides the huge amount that Microsoft has dumped in marketing it really is a half baked OS at launch.

I mean it wasn't a buggy, half complete mess of a product that some of their products have been. For example the Kin. It was a "social" phone without many social features. It crashed a lot. The advertised features didn't work right. While the WP7 lacks the maturity of the iPhone, Android, even WebOS, it is at least usable. Many of their version 1.0 products can't say the same. It will take time for WP7 to catch up, but it's a decent start.