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Microsoft Posts First Quarterly Loss Ever

Posted by samzenpus on from the hole-in-the-bucket dept.

HangingChad writes "Microsoft's announcement of a late October release date for Windows 8 was eclipsed by its earnings report, in which the computer giant posted its first-ever quarterly loss since going public in 1986. The loss stems from Microsoft's continued struggles with the online services division."

86 of 327 comments (clear)

  1. Yay! by Anonymous Coward · · Score: 5, Funny

    We waited for this for too long!

    1. Re:Yay! by Anonymous Coward · · Score: 5, Informative

      NSFW

    2. Re:Yay! by Anonymous Coward · · Score: 5, Funny

      Yes!! They are totally in their final days! If they do this 80-100 more times they'll be finished!!!

    3. Re:Yay! by danomac · · Score: 5, Insightful

      Microsoft made a bad acquisition and they lost money. They have a long way to go before their situation gets dire.

      I guess when you're big enough you can do a six billion dollar oops and nothing much happens.

    4. Re:Yay! by HarrySquatter · · Score: 5, Informative

      You're joking, right? Last fiscal year they had net income of $23 billion and the previous quarter they made they made about $21 billion in revenue and net income of $6.6 billion.

    5. Re:Yay! by HermMunster · · Score: 3, Insightful

      This is nothing more than creative accounting meant to give them a mean tax write-off at FY-End. They didn't really make money. Nothing they bought that showed a loss could possibly eliminate billions a quarter in revenue and profit.

      --
      You can lead a man with reason but you can't make him think.
    6. Re:Yay! by danomac · · Score: 5, Informative

      I probably shouldn't respond to an AC... but oh well.

      I actually read TFA and it said they lost $6B due to a bad acquisition and that's why the quarterly profits were where they were. I made a deduction from that article that it isn't going to affect Microsoft in any way really and posted a reply to the 'finally they're going down' comment.

      I'm not what you'd call a fan of Microsoft in any way, I use their products because I have to.

      Basically what happened is a bug hit Microsoft's windshield , and Microsoft will flick on the wipers and be on their merry way.

    7. Re:Yay! by Johann+Lau · · Score: 4, Insightful

      I kind of stopped wanting Microsoft to die. We need something new that DOESN'T suck (not just one, make that 2-3). Death of MS would accomplish nothing but more consolidation for the other poopyheads.

    8. Re:Yay! by user+flynn · · Score: 2

      And the $6.2B was a write down from a 2007 acquisition.

          Not to mention stocks are up 2.5% after the announcement (not just the part about a $492M quarterly loss, and I use the word loss loosely).

      --
      In the distance you hear an ominous moo.
    9. Re:Yay! by Pesticidal · · Score: 5, Funny

      Shouldn't that be Brokeback Mountain Lion?

    10. Re:Yay! by Tough+Love · · Score: 2

      They have a long way to go before their situation gets dire.

      It's a great start though. You go, Steve!

      --
      When all you have is a hammer, every problem starts to look like a thumb.
    11. Re:Yay! by SurfsUp · · Score: 2

      I guess when you're big enough you can do a six billion dollar oops and nothing much happens.

      They didn't lose $6 billion, only $583 million.

      No, they lost $6 billion+ on Aquantive. Thanks for playing.

      --
      Life's a bitch but somebody's gotta do it.
    12. Re:Yay! by symbolset · · Score: 3, Informative

      The accumulated deficit of OSD is now about $16 billion. Any way you slice it that's a lot to spend on a grudge.

      --
      Help stamp out iliturcy.
    13. Re:Yay! by Anonymous Coward · · Score: 2, Informative

      And the $6.2B was a write down from a 2007 acquisition.

      Taking the loss now is intended to make things look better once Windows 8 has launched. They've shuffled numbers before to mask slow uptake, like combining their Mac software numbers with Xbox 360 to fluff up the later.

    14. Re:Yay! by Billly+Gates · · Score: 4, Insightful

      I kind of stopped wanting Microsoft to die. We need something new that DOESN'T suck (not just one, make that 2-3). Death of MS would accomplish nothing but more consolidation for the other poopyheads.

      Apple is enemy number 1 right now. Not Microsoft. For the older folks on here they remember IBM as the bad guy and MS as the good guys and so on. I really do hope Windows Phone 8 succeeds yes I know slashdotters may not agree with me, but it is good for competition. Google could decide it is not worth it to be sued and sign an agreement with Apple to leave the market and have them only use Google services or something scary. You never know. Infact, if the lawsuits get worse I would do just that if I were Schidmt at Google. Andriod is a loss leader anyway they make money with searches.

      Anyway not to go offtopic competition is good and slashdotters should consider their stance on Microsoft. They are not the scary guys who made crapware 10 years ago anymore. Windows 7 !=WindowsME/Dos4, Windows Phone != WinCE, and IE 10 != IE 6.

      Apple is pretty cool still for many so my post is controversial but Apple scares me much more than MS and they are far more powerful now. Just my 2 cents even if they do make a Unix like consumer oriented OS.

      --
      http://saveie6.com/
    15. Re:Yay! by MrHanky · · Score: 3, Interesting

      Microsoft just had their highest quarterly revenues ever, and hid their profits by writing off a 2007 $6B acquisition. It's all tax deductible, you know.

      There's so much dumb wishful thinking in this thread.

    16. Re:Yay! by MrHanky · · Score: 3, Interesting

      Correction: it's non-deductible. Still, it will look better writing it off this quarter as opposed to taking a loss when Windows 8 is released.

    17. Re:Yay! by Anonymous Coward · · Score: 3, Informative

      I wish I knew what NSFW meant before opening the link :'(

      http://en.wikipedia.org/wiki/Not_safe_for_work

    18. Re:Yay! by BeanThere · · Score: 2, Informative

      This sounds more like it was a major once-off write-off of a loss-making division (a "me-too" attempt at online advertising to try compete with Google - hell, I didn't even know Microsoft had such a division until I read this), rather than necessarily an indicator of poor cash flow. So I wouldn't be ringing that death knell quite yet. The way Apple's going with their increasingly patent-troll-based business model, we might yet want to see strong competition between all the major players rather than consolidation.

  2. Another Shitty Summary. by Anonymous Coward · · Score: 5, Insightful

    The loss stems from a giant write down of a purchase gone bust ($6.2billion) from 2007. Otherwise it would have been a great quarter for "M$".

    But don't let that stop the speculation about how "M$" is about to die.

    1. Re:Another Shitty Summary. by jcr · · Score: 5, Insightful

      They're not going to die this year, but they do have a long decline ahead of them, just like IBM in the 90s. Ballmer's been wasting the shareholders' money on failing ventures for many years now, and the Windows/Office cash cow is running out of steam.

      -jcr

      --
      The only title of honor that a tyrant can grant is "Enemy of the State."
    2. Re:Another Shitty Summary. by je+ne+sais+quoi · · Score: 4, Informative

      It was in fact NOT a great quarter for Microsoft. I agree that the $6.2 billion loss on the acquisition is a red herring, but if you disregard that and look at the rest of their business, you'll find that their windows revenue declined 13% Yes, DECLINED 13%. Now, you can further write off most of that decline by saying that this is due to the reduced cost of Windows 8 that Microsoft offered to people buying Windows 7 now, but even after you do that, Windows revenue declined 1%. That's not huge, but they still DECLINED in windows sales. You know... WINDOWS... one of the two cash cows that Microsoft owns? Microsoft's core business is shrinking. If I help Microsoft stock, I'd be a bit worried. (For what it's worth, I do hold Apple stock, and I'm worried there too, Microsoft's wave has crested, Apple's is at the peak so there's nowhere to go but down, I'm just waiting for the right time to sell, it might be now.)

      But don't let that stop the speculation about how "Microsoft" is doing great.

      --
      Gentlemen! You can't fight in here, this is the war room!
    3. Re:Another Shitty Summary. by bitt3n · · Score: 5, Funny

      the Windows/Office cash cow is running out of steam.

      I think this is a relevant moment to reflect on that timeless investment maxim, "never put money in a company whose profits depend on a steam-powered cow."

      --
      how many pairs of boxer shorts should you own?
    4. Re:Another Shitty Summary. by cpu6502 · · Score: 4, Interesting

      Not me. I'm buying a new PC/laptop NOW while it still comes with Windows 7, versus getting stuck with Vista Part 2 (Win8).

      Oh and not everything is bright & shiny. The article continues: "The charge was an acknowledgement that the companyâ(TM)s struggling online services division is a significant financial drag on the company, losing nearly $2 billion over the past year in addition to the $6.2 billion writedown. Microsoft is still pouring money into runner-up search engine Bing, but it only has a fraction of the market share rival Google enjoys. "It brings into question Microsoftâ(TM)s ability to compete on the advertising-driven web and suggests this is a market segment that is beyond Microsoft, creating long-term doubts over Bingâ(TM)s future," Rob Enderle, principal analyst at the Enderle Group, said via email."

      --
      My AC stalker: " I personally agree with your posts most of the time, but that won't keep me from modding you troll"
    5. Re:Another Shitty Summary. by SurfsUp · · Score: 2

      They're not going to die this year, but they do have a long decline ahead of them, just like IBM in the 90s.

      Unlike IBM they won't pull out of it because they have no lucrative hardware business to fall back and no loyal stable of clients to turn themselves into a service operation. And unlike IBM, who only earned the hatred of a few thousand professionals, Microsoft has earned the hatred of millions and is still working on it.

      For Microsoft, this ends at $0 per share.

      --
      Life's a bitch but somebody's gotta do it.
  3. Loss due to 8 billion write down. by 140Mandak262Jamuna · · Score: 5, Insightful

    No, Microsoft did not bring in less money than it spent. It has decided to wash its hands off of some of the investments it made. It wrote down the value of some of the stuff it owns, and that is shown as a loss.

    --
    sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
    1. Re:Loss due to 8 billion write down. by Anubis+IV · · Score: 3, Informative

      Indeed. They made an investment that didn't pan out several years ago, and now they're writing it off in a lump sum that's hitting them this quarter. That means that the biggest contributor to their quarterly loss was a one-time event that is already over and will not have any bearing on future profits or losses. This is not the proverbial writing on the wall yet.

  4. Ballmer by twistedcubic · · Score: 4, Insightful

    This should be the end of Steve Ballmer's reign. He was a genius at muscling OEMs into screwing over the competition, but now that Windows is so ubiquitous, there's nothing else for him to do but retire.

    1. Re:Ballmer by antifoidulus · · Score: 2

      Like Cain from kung-fu, if Cain were a fat, balding old white man.

      --
      Monstar L
  5. Take a look at the details by Anonymous Coward · · Score: 4, Interesting

    That loss is entirely down to the aQuantive 6.2 billion writedown. As far as analyst estimates are concerned, taking that into account, this is actually a beat. Take a look at after-hours stock price movement. Did MSFT get slammed?

    1. Re:Take a look at the details by MightyMartian · · Score: 5, Funny

      That loss is entirely down to the aQuantive 6.2 billion writedown. As far as analyst estimates are concerned, taking that into account, this is actually a beat. Take a look at after-hours stock price movement. Did MSFT get slammed?

      No, but in a distant corner of the galaxy, Gronek II, Emperor of the Seventh Moon of Choil, after a tasty breakfast of fried duzelwip, lightly salted wurp jelly and a hot steaming cup of rinok-sphoo, opens up his paper to find out that his most beloved child, the fruit of his loins, the offspring of his brief but tumultuous marriage to Princess Nerb the Six-breasted; Steve Ballmer, has ceased to throw chairs, fuck over Netscape and perform all those other ceremonies one would expect of a scion of the proud house of Choil, and in his greater anger has spat out an orifice-full of hot rinok-sphoo. Before the Sixth Moon of Choil has done its second transit, the invasion fleet will be in place, and Steve Ballmer, once proud Prince of Choil will have to answer for his actions.

      --
      The world's burning. Moped Jesus spotted on I50. Details at 11.
    2. Re:Take a look at the details by iluvcapra · · Score: 2, Insightful

      Did MSFT get slammed?

      No, the Street amortized the slamming over the last 12 years. Price on December 31, 1999: $58 3/8s.

      --
      Don't blame me, I voted for Baltar.
  6. "the loss stems from..." by Haxagon · · Score: 4, Informative

    "The loss stems from Microsoft's continued struggles with the online services division."

    That's a flat-out deception! The loss stems from the fact that they made a 6 billion dollar write-off. The summary makes it seem like their online division is just naturally bleeding billions.
    Millions, maybe, but not billions.

    1. Re:"the loss stems from..." by DragonWriter · · Score: 5, Insightful

      "The loss stems from Microsoft's continued struggles with the online services division."

      That's a flat-out deception!

      No, its not.

      The loss stems from the fact that they made a 6 billion dollar write-off.

      A $6.2 billion write-off against a $6.3 billion dollar purchase of an online advertising firm in 2007 that was intended to be a main engine of profit for their online services division. When you purchase a business for $6.3 billion to reinforce a particular part of your company, and five years later recognize that its only worth $100 million (or less than 1/60th of what you paid for it), its pretty fair to describe as that part of the company as struggling.

      The summary makes it seem like their online division is just naturally bleeding billions.
      Millions, maybe, but not billions.

      Microsoft themselves, in the write-down, is recognizing that $6.2 billion that they spent on their online services division might as well have been piled up as cash and made into the world's largest currency bonfire.

      Bleeding in worthless acquisitions is still bleeding. Some might attempt to distinguish losses from acquisition write-downs from losses from other operations, but with Microsoft -- and many other large firms -- acquisitions are a key and regular part of their operations. If their acquisition strategy is bad and bleeding money, they are bleeding money just as much as if they were losing it from other operations.

    2. Re:"the loss stems from..." by b4dc0d3r · · Score: 4, Insightful

      The summary makes it seem like their online division is just naturally bleeding billions. Millions, maybe, but not billions.

      I agree that it mis-attributed the cause, but they lost 2 billion last year without the write-down, which is plural billion, which is billions. They are bleeding billions.

    3. Re:"the loss stems from..." by shutdown+-p+now · · Score: 3, Insightful

      I think the point is that it's meaningless to look at the loss and say that it's indicative of this quarter being particularly worse than the preceding ones - i.e. that it's a start of a downward trend (which TFS is implying). More accurate representation of this $6B loss would be to spread it evenly over the period since acquisition.

    4. Re:"the loss stems from..." by reversible+physicist · · Score: 2

      The ad acquisition was intended to help their online businesses, which lost $2 billion in the past year, and is instead a complete write-off. They have several other big bets that could fail, including Bing and their Windows 8 move into mobile. If these fail, there will be more big write-offs.

    5. Re:"the loss stems from..." by shutdown+-p+now · · Score: 2

      From the title of the article. "First quarterly loss ever" is not particularly important when the loss in question is just an accounting trick to defer and lump together the recognition of a loss that occurred a long time ago in practice.

    6. Re:"the loss stems from..." by fermion · · Score: 3, Interesting
      Here is my take on this. One does not have 25 years continuous profits by accidents. One has accountants which manufacture the numbers so that quarterly expectations are meet. So the question is why did they allow a non profitable quarter. It is simply a lack of management. I am not saying that we have an Enron situation in which the profits are fabricated. But I am saying is that there is clearly a breakdown in balancing profit and losses. It could be a laziness that has developed because it has always been easy to balance losses from bad decision from profits due to market monopoly. It could be a deeper issue with lack of control of purchasing and managing expectations of departments.

      In any case a loss is indicative of a problem. We will see if there are more losses in the future, and what this does to the companies expectation.

      --
      "She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
  7. MSFT got distracted by... by acjacinto · · Score: 4, Funny

    0xB16B00B5

    Ref: http://linux.slashdot.org/story/12/07/19/1923200/microsoft-apologizes-for-inserting-naughty-phrase-into-linux-kernel

  8. Positive cash flows by Mean+Variance · · Score: 4, Insightful

    They wrote down a turd whose asset value wasn't worth what they paid. Look at the cash flows. They continue to generate billions of cash.

    SEC filing

    1. Re:Positive cash flows by Mashiki · · Score: 2, Insightful

      Yeah. Leave it to the typical MS hate by people here on /. to go apeshit over stuff like this. The story should be modded +1 flamebait.

      --
      Om, nomnomnom...
  9. Blood in the Water by amiga3D · · Score: 4, Insightful

    In and of itself this isn't a big deal. They wrote off some bad investments, so what? The problem is that everyone watches MS looking for any sign of weakness. It's more the perception that they don't have it anymore than any reality. I believe this is the beginning of the end, not of MS but of their overwhelming dominance that they've enjoyed for so long.

  10. Write down is still money that was spent by DragonWriter · · Score: 4, Interesting

    No, Microsoft did not bring in less money than it spent. It has decided to wash its hands off of some of the investments it made.

    The second sentence is basically true, but the first is somewhat misleading. Essentially, they recognized that a $6.3 billion purchase of aQuantive that they made (which wasn't counted as an expense at the time, because it was treated as the acquisition of an asset of equal value to the purchase price) was, in fact, almost a pure expense, since the asset they acquired turns out to be pretty much entirely worthless (they took a $6.2 billion writedown against the $6.3 billion purchase.)

    But that writedown is money that was actually spent, its just money that was spent in 2007 and not counted as an expense then.

  11. Article: It failed to see iPhone and touchscreen by 140Mandak262Jamuna · · Score: 5, Interesting

    In addition to its $6.2 billion disaster of a purchase, Microsoft made another critical mistake in 2007: It failed to recognize the debut of Apple's iPhone as the game-changer it turned out to be and missed the launch of the touchscreen revolution. Its partnership with troubled Finnish cell phone company Nokia notwithstanding, Windows phones barely have a toehold in the iOS-Android duopoly.

    It is par for the course for Microsoft to phoo phoo anything new (Remember "640K memory is enough for everyone", "You mean companies are going to print their URLs in their advertisements?" ) and then play catch up. Usually that strategy worked out for Microsoft because corporate computers formed 90% or more of the computing platforms in the world, and it had a stranglehold on that market.

    Two things stymied Microsoft in the cell phone arena. First was obvious: It lacked market dominance for ram through bad but barely adequate competitor and swamp out the competition.

    But there was a second player, that we slashdotter would loathe to give credit to. The much maligned evil phone companies. They are used to getting hefty margins peddling corded and cordless plain old telephone equipment. They saw what happened to the manufacturers of the ubiquitous beige boxes. They were reducing competing purely on price, the brutal price war changed the landscape. In the 1990s the hardware accounted for 95% of the cost of the computer and the software was hardly 5%. While software prices remained stable and went up (MS-Office retailed for $550 when the PCs had fallen below 500$ mark). The telcos were determined to not to let that happen to them. Being incompatible with Microsoft, and not giving it any toehold was the common strategy.

    So even if someone in Microsoft saw the threat of iPhone that company is too big to move nimbly, too bogged down in earlier mode of competing, it had made too many enemies, it has stabbed the back of too many partners and it has scared off too many partners.

    --
    sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
  12. Re:First post by Anonymous Coward · · Score: 2, Funny

    More like M-$

  13. Re:First post by Anonymous Coward · · Score: 4, Funny

    Shit, dont any of you know Accounting 101?

    (M$)

  14. Re:and it's going to get worse due to market force by Bigfishbowl · · Score: 2

    You know, I keep hearing this, but I do not understand how that is true. Were it true, you, being a slashdotter and thus years ahead would be composing this on a tablet. Apparently the soft-keyboard and such are no bother, nor is the lack of easy copy/paste functions. Personally, I'm typing this on my workstation which will never, ever, ever leave my office. Nor should it. I create content and solve problems on it. People may later consume said content but if you want to actually get anything more serious than email done, you need a real computer. Furthermore, could you imagine spending 8 hours a day on a tablet? That is a laughable suggestion. Given that unemployment is less than 50%, I suspect most people using computers for something other than leisure will still use a keyboard at some point during the day.

  15. Re:Mod Up: Informative by oakgrove · · Score: 2
    Um...from the summary:

    The loss stems from Microsoft's continued struggles with the online services division

    Was not the 6 billion dollars they wasted on aQuantive an effort to better place themselves in the online ad sales picture?

    --
    The soylentnews experiment has been a dismal failure.
  16. Break Them Up by geoffrobinson · · Score: 5, Insightful

    They would actually be more valuable broken up. Windows could still do their thing. Office could support whatever platform they wanted to. Imagine a version of Office for Mac with a comparable version of Excel and Access. SQL Server on Linux boxes.

    Also, I would say there is a difference between decline and not being in your high growth phase and abnormally dominant phase.

    --
    Except for ending slavery, the Nazis, communism, & securing American independence, war has never solved anything.
    1. Re:Break Them Up by jcr · · Score: 3, Interesting

      They would actually be more valuable broken up.

      Well, potentially. Their biggest problem though is an empire-building management culture, and if those attitudes continue into the smaller organizations that result from a breakup, they'd die faster.

      -jcr

      --
      The only title of honor that a tyrant can grant is "Enemy of the State."
  17. Re:Mod Up: Informative by LordLucless · · Score: 3, Insightful

    It's not from their "continued struggles", it's from a single acquisition 5 years ago. And it says nothing about their online services division as a whole, just the advertising segment represented by aQuantive. It'd be like saying "Google's online services take 600 million dollar hit" if Google decided to scrap Google Flights.

    --
    Just because you're paranoid doesn't mean there isn't an invisible demon about to eat your face
  18. Re:Article: It failed to see iPhone and touchscree by real-modo · · Score: 4, Interesting

    Microsoft's problem is exactly that it has bought into this "threat of the iPhone" meme.

    Microsoft and Apple have different markets and different sales channels. By trying to compete with Apple, Microsoft is exchanging a position of dominance in enterprise "productivity" computing for one of abject weakness in consumer/mobile/fashion computing. In so doing, it is alienating its partners and customers even more than usually.

    Sure, enterprise computing is a mature market, and it's not possible to continue double-digit growth in it any more. Big deal. Are electricity utilities reinventing themselves as iOS app developers? No; they are making good money in a static to declining market. That's the mature, high-return, low-risk strategy.

    Microsoft needs to ignore Apple; if it doesn't, lawyers will be getting fat off aggrieved shareholders.

  19. Re:Tin foil hats kids!! (not aluminum) by Mabhatter · · Score: 2

    This will also help Ballmer say Windows 8 "saved the company" with their first profitable quarter after terrible, terrible losses.

    It's all marketing.

  20. math by buybuydandavis · · Score: 2

    Except for a paper write down which only acknowledged a fact of reality established years ago, they made 5.7billion. And that's in anticipation of a big release in the near future, that is probably limiting current sales until the release.

    Buy now.

    It would be interesting to see if they piled on a few other write downs.

  21. Like what? by PrimalChrome · · Score: 2

    Until there's something out there that "doesn't suck", I'd like Microsoft to remain healthy and viable.

    Apple's walled garden where everything will soon have to be bought through the app store and whose server product is laughable? Nah.

    Linux flavor of the week that totally ignores the need for corporate Groupware and thumbs it's nose at the idea of a homogeneous environment? Nah.

    BeOS? Mayyyyybe

    So I suppose one option is better than none....

  22. Re:Article: It failed to see iPhone and touchscree by esarjeant · · Score: 2

    I think this is an excellent observation, while it really won't hurt MS to go after the mobile phone market since Windows Mobile wasn't going anywhere - they are about to plunge into a new battle where they are going to sacrifice one of their cash-cows (Windows/Office) to compete with iOS and Android.

    They should focus on the enterprise market, and find ways to compete on iOS/Android without writing another tablet OS.

    --

    Eric Sarjeant
    eric[@]sarjeant.com

  23. So Ballmer can't even buy cashcows by Anonymous Coward · · Score: 5, Insightful

    It seems to me the cash cows they can milk by raising the prices, but Ballmer can't create NEW cash-cows internally in MS, not only that, this tells me he can't even BUY new cash cows from outside.

    You can make light of this, but this is spent money, and yet it took him 5 years to realize he'd wasted it???? The man is an idiot, a shouty salesman whose biggest sales job is to keep himself in power.

    He's losing the Windows market, this is what gets me the most, you can see it all unfolding in slow motion as people switch away from Windows and he's making it worse by splitting Windows into two competing versions! It reminds me of IBM making PCs and also selling cloned PCs in competition with itself. It made IBM clearly inferior because even they didn't believe their PCs were worth it.

    Now we have MS, launching 2 tablets, one that is more compatible than the other, but not fully compatible, and one that has a better battery life but not as good as the competition. Two half products in a market that's getting away from them.

    And nobody dares sack shouty salesman for fear of chairs flying???

    1. Re:So Ballmer can't even buy cashcows by lightknight · · Score: 2

      If he's somewhat intelligent, perhaps he will ask Gates to fix his advisory board for him. The man has surrounded himself with the wrong people -> they're using him like a puppet, and he can't see that, and probably won't see it until the company is being sized for a coffin. They aren't his friends, they don't really think he's a business genius or whatever smoke they're blowing up his ass, and he needs to ditch them NOW. While he's at it, promote some of the IT and some of the CS / SE people to fill their spots. Find the people that others hate, not because they're annoying, but because they will tell anyone when they're making a grave mistake, regardless of rank. The IT guys will tell him what works (from a corporate standpoint), and the CS / SE guys will tell him what can be done (programmatically speaking).

      Frankly, it's surprising he didn't do this already. The original trio of Gates (half-lawyer, half-businessman, half-programmer), Paul Allen (all programmer), and Ballmer (all business) worked; things held one without Paul, but without Gates it has gone downhill. Make a new trio, and try for the same attributes. If that means offering them some stock, do it.

      --
      I am John Hurt.
  24. Re:Mod Up: Informative by SurfsUp · · Score: 2

    the loss isn't from Bing's success or lack thereof. It's from aQuantative's write off

    It's from Microsoft's lack of online success in general. Aquantive was supposed to sell display ads but nobody wanted to pay Microsoft to display their ads. For some reason.

    --
    Life's a bitch but somebody's gotta do it.
  25. Re:Mod Up: Informative by LordLucless · · Score: 4, Insightful

    Sorry, apology? Looks through my posting history - I'm exactly the opposite of a Microsoft apologist. When I see a headline saying Microsoft's taken a quarterly loss for the first time, and it's due to struggling online services, I'm expecting it to be the thin end of the wedge - that MS' new strategies are failing, and that it's OS and Office divisions are no longer drawing enough money to keep the behemoth lumbering.

    That's not what's happening. Rather, they've taken the losses of the last 5 years, and conglomerated them into a single, large, writedown that is only really meaningful for tax purposes. In short, it's an accounting glitch, and it's being spun as the opening turn of the company's death spiral. I'm annoyed, not because I want MS to be shown as profitable, but because it's a) spin, and deceptive, and b) disappointing. I was hoping for a real decline, not some accountancy artifact.

    --
    Just because you're paranoid doesn't mean there isn't an invisible demon about to eat your face
  26. Re:Mod Up: Informative by SurfsUp · · Score: 2

    Looks through my posting history - I'm exactly the opposite of a Microsoft apologist.

    I applaud you for that, but there is still no need to cut Microsoft slack where they don't deserve it. Which words describe the situation better: 1) "little accident" or 2) "slow motion train wreck"?

    --
    Life's a bitch but somebody's gotta do it.
  27. 28% Windows market share by Anonymous Coward · · Score: 5, Interesting

    50 million Windows 7 licenses/quarter.
    76 million Android activations/ quarter
    46 million iOS devices, 50 million is you add the Mac sales / quarter.

    See for yourself, they're market share is down to less than 30%, soon Apple will be selling more iOs devices than Microsoft sells Windows.

    1. Re:28% Windows market share by asdf7890 · · Score: 4, Informative

      You don't have to make money, directly or otherwise, to have market share, nor do you have to make money to have an impact on your competition. And when discussing Windows' market share with regard to, say, desktop installations, no one discounts those installs that are pirated copies (most are in some parts of the world) because whether or not those installs made money for MS does not affect that fact that their OS is used on those machines.

    2. Re:28% Windows market share by asdf7890 · · Score: 5, Informative

      That isn't really an apples-to-oranges comparison though. The desktop/laptop markets are different enough from the phone/tablet ones at the current time that you probably shouldn't compare Windows 7 against iOS and Android.

      Also iOS and Android are growing fast due to new kit the people previously didn't own - they are not replacing Windows in most cases. MS's install base is rather impressive compared to iOS and Android so even at their current growth rate (which they can't maintain indefinitely - there will be a saturation point in the market somewhere) it'll be much time before they come close to eclipsing Windows.

      I'm happy for you to put Microsoft down, but I recommend not using obviously flawed statistics as it just looks like desperation (when such desperation is probably not required).

    3. Re:28% Windows market share by Xest · · Score: 5, Insightful

      Wait, you forgot to include my fridge and central heating system, neither of these run Windows either. Christ, even throwing servers into the mix where operating systems like Linux hold a greater share would make more sense than mobile.

      Honestly, I'd like to see more competition in the desktop OS market too, but pretending desktop licensing and mobile operatings systems are in the same market is fucking stupid.

      Mixing some arbitrary devices into the OS mix doesn't change the fact that Microsoft is still far and away the most dominant entity in the desktop/laptop market.

      It doesn't really matter how many iOS devices Apple sells or Android devices Google and friends sell, people still aren't going to be writing software, producing spreadsheets, creating presentations, creating web pages, using most business systems, and authoring documents, on their tablets and phones. Have you tried doing any lengthy amount of office work on a mobile device? Without turning it into a desktop/laptop by attaching a keyboard/mouse it's the quickest route to insanity. Tablet versions of much common desktop software such as Office pale in comparison to the real thing. For this reason the key point is that no matter how many extra smartphones/tablets are sold out there, the effect on Windows desktop license sales is going to be negligible. People may be buying tablets, but few are foregoing a PC/laptop as a result, they just get both. Christ, up until recently you couldn't even activate an iOS device and get content onto it without a computer anyway.

      Yes mobile is becoming ever more important, no it's not going to replace the desktop, it just extends where you can do some of your desktop work (e-mail, web apps). Touch is great, but it's not the be all and end all, it's an extremely shit input method for many, many common tasks still.

      This is why you can't lump mobile and desktop together, for the most part they're different markets, the areas in which they intersect are fairly small and limited to for example, situations like tablets acting as a good carry round the home web browser instead of a netbook.

    4. Re:28% Windows market share by Anonymous Coward · · Score: 2, Insightful

      Not everybody does "office work" or needs a full-on laptop or desktop capabilities.

      A phone (who are we kidding, they are ultra-portable computers) or tablet device can easily fit the needs for surfing the net, consuming media and communicating via voice, video, messaging or social media.

      I am confident that Microsoft did not see themselves being usurped by phones and tablets on the scale you will see in the next 5 years. For the average non-techy who does not need any serious horsepower for creating documents, spreadsheets, music, video or images the phones and tablets replace entry level computer devices.

    5. Re:28% Windows market share by justforgetme · · Score: 2

      Yes but my empirical analysis of first world citizens leads me to believe that the end setup for the avg person - and after the mobile market gets saturated - is two mobile devices (phones, tablets) and one Classical personal computer (laptops and HTPCs included).

      Which means that after market saturation you should on average have twice as many mobile OS images as PC OS images installed. The mobile computer market will keep on becoming bigger and bigger there is no question in that. I just hope that we will manage to get away from the ludicrous "Standalone App even though it just is a d@mn webapp" software trend.

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    6. Re:28% Windows market share by Sloppy · · Score: 3, Interesting

      I was going to say, "You miss the point; Microsoft doesn't make money on Android either," but then I remembered, oh wait.. actually they do.

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    7. Re:28% Windows market share by Just+Some+Guy · · Score: 3, Insightful

      I'd like to see more competition in the desktop OS market too, but pretending desktop licensing and mobile operatings systems are in the same market is fucking stupid.

      I'm sorry, but did you think that "desktop computing" and "mobile computing" were markets? The market is simply "computing".

      It doesn't really matter how many iOS devices Apple sells or Android devices Google and friends sell, people still aren't going to be writing software, producing spreadsheets, creating presentations, creating web pages, using most business systems, and authoring documents, on their tablets and phones.

      Outside of an office, almost no one wants to do those things. (Note: you, I, and the rest of Slashdot don't statistically count. We're a tiny minority.) People want to share pictures, browse the web, listen to music, watch movies, and do lots of other things that phones and tablets are perfectly good at.

      People may be buying tablets, but few are foregoing a PC/laptop as a result, they just get both.

      Have you talked to anyone outside an office? I personally know plenty of people who bought an iPad and abandoned their desktops and laptops. When it comes time to upgrade their less-portable systems, the thought process becomes "you know what, I don't really use it anymore. I guess I'd like to run ${application foo}, but not so much that I want to buy a whole new computer just for it, and have to set aside desk space for it, and it just sits there the rest of the time..."

      This is why you can't lump mobile and desktop together, for the most part they're different markets, the areas in which they intersect are fairly small and limited to for example, situations like tablets acting as a good carry round the home web browser instead of a netbook.

      "This is why you can't lump digital and film cameras together, for the most part they're different markets, the areas in which they intersect are fairly small and limited to for example, situations like digital cameras acting as a good carry round the city camera instead of the nice film camera that they'll keep around for Important Stuff."

      How'd that work out?

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  28. Interesting timing, too by melted · · Score: 3, Insightful

    Most of you don't know this, but Microsoft gives out bonuses and stock grants in September. This is a good excuse to stiff the employees a bit, and by god they're gonna use it. Being employed by a Microsoft's competitor, I can't help but like this course of events, since we get an influx of resumes from there every October or so, and while most of the people who apply should really be flipping burgers instead, every now and then we do hire a brilliant engineer.

  29. Smartest guys by bill_mcgonigle · · Score: 4, Interesting

    a $6.3 billion purchase of aQuantive

    Seriously - whoever made this deal for aQuantive is a certified genius. That was about 1000x their earnings. People say Amazon investors are absolutely batshit crazy for buying at 187x earnings, and they're not a third-rung company.

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  30. Re:More like 72% lost share by Miamicanes · · Score: 5, Insightful

    Windows might be losing market share to OSX. God only knows whether it's gaining or losing market share compared to desktop Linux this week/month/year, and it doesn't particularly matter because any change is below the margin of error anyway. Windows is not, however, losing market share to Android Phones or iPhones.

    In America, at least, 99.9% of the people who own an Android phone or iPhone own at least one desktop PC, laptop, or both IN ADDITION to their phone.

    Microsoft lost most of their mobile market share almost OVERNIGHT when they stupidly announced that the HTC HD2 would never run Windows Phone because "it had too many buttons", and just about everyone who owned a phone running Windows Mobile ran straight to Android without passing "Go". THAT is Microsoft's lost market share. Nearly every Android phone and iPhone sold since that time represents a PDA phone sold to somebody who formerly owned a phone that was a half step better than a Jitterbug. People who own an Android phone or iPhone today and do NOT own a PC or laptop probably didn't own a PC or desktop 4 years ago, either. People who owned a desktop PC and a laptop 4 years ago mostly still own a desktop PC, a laptop, and have recently added a tablet (Android or iPad) to the pile, and probably have a best of breed Android phone or iPhone filling the role of "pocket laptop with wireless internet access", just like they did 4 years ago.

    If you REALLY want to see lost market share, do your census a month after Windows 8 comes out, and count anybody who yawned and stayed with Windows 7 (or reverted to Windows 7 after being unimpressed by Windows 8) because Windows 8 is ugly, looks like Unity on a bad day, and took away Aero Glass because Microsoft apparently wanted to make extra sure the reaction of everybody with a high end PC would be "yuck, Windows 8 is fugly".

    If it's not obvious, I do think that Microsoft has gone batshit crazy and suicidal in its old age. If you look at just about every business and strategic decision they've made since ~2008, they've dropped the ball and bent over backwards to snatch defeat from the jaws of victory at every possible opportunity. They've become irrelevant to everyone who used to own a Windows Mobile phone, they've completely pissed off two entire generations of Windows Phone buyers by screwing them out of upgrades and saddling them with a phone that was obsolete roughly 3 months after it came out, they locked them down for reasons nobody can figure out (since they don't actually have any real software that anybody will pay for to generate royalties for Microsoft), they've completely dropped the ball on trying to run an ad network like Google, and now it looks like they've spent the past 3 years brainstorming ways to give people who own Windows 7 a reason to stick with it for the next 10 years.

    And it makes me sad. As fashionable as it is around here to bash Microsoft, they've generally been a force for good. If nothing else, they gave us mice with scroll wheels. But lately... (shakes head)... well, the only word I can really think of to describe it is "Schadenfreude". It's almost heresy to say, but they really DO need Bill Gates to come back and save Microsoft from the zombie it's become. Microsoft's current management is like Apple under Scully.

  31. How many MS apps REQUIRE Windows?? by Anonymous Coward · · Score: 5, Interesting

    I'll point something else out here: Microsoft has a lot of products, a LOT, and most of them are small income products. The one thing they have in common is THEY ARE BUILT FOR THE WINDOWS ECOSYSTEM.

    If they lose the OS market, they lose everything. Because Ballmer's pride won't ever let him port all those apps to whatever is selling, he'll follow Windows market share down to zero.

    I know it's popular to say "well IBM are still doing well", but they're not doing well in the PC market place. They were lucky to find a lot of government contracts and services saved them, but they lost the PC market to others. Will MS find a market to run to if they lose Windows??? If so what market??

    Is it Schadenfreude to simply spell out the truth here?? They've ALREADY lost the OS market, they're LOSING the apps market. The apps market trails the OS market, because of the legacy sales. Those XP users are potential customers too, even if they're not sales in this quarter. But Ballmer is so stuck in the past, he thinks he can force XP users to upgrade to Windows 8, but they (I include me in this) will go to Android or iOS. I'm switching to Android tablet after this, already have an Asus infinity on order.

  32. Re:More like 72% lost share by rsborg · · Score: 4, Insightful

    If it's not obvious, I do think that Microsoft has gone batshit crazy and suicidal in its old age. If you look at just about every business and strategic decision they've made since ~2008, they've dropped the ball and bent over backwards to snatch defeat from the jaws of victory at every possible opportunity

    As much as I dislike Microsoft, you're being a bit unfair - they are competing with companies like Google and Apple - who execute *very* well. If your competitors are bringing their A game and you've been bringing your B game for the past decade but were the only game in town back then, of course you will look bad.

    Keep in mind that,while bringing their B game, MSFT has been making money hand over fist for that past decade and their top-line is amazing. It's just, they are no longer the biggest/brightest/boldest company around.

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  33. Re:More like 72% lost share by Anonymous Coward · · Score: 4, Insightful

    Bill Gates didn't make Microsoft, IBM did. Like Steve Jobs said: "Microsoft went into orbit because it had a booster rocket attached to it called IBM". Well, IBM left the consumer market a long time ago, they certainly can't save MS now.

  34. Facetime by Anonymous Coward · · Score: 5, Insightful

    I think you're kidding yourself. People who use Facetime are not using Skype, people who surf on an iPad are not surfing on a PC, people who play games on the tablets are not playing games on Windows. For me my PC was mainly stock trading and email/messaging, that's now mainly on an Android tablet.

    You can claim that somehow Windows market is special, for 'real-work', but I use a Galaxy Note for most of my 'real work' and the PC is used only for its large screen when I happen to be in my office. When I've switched to an Infinity Pad, it won't even be the largest screen computer I have, at that point the charts will shown on the Android tablet and the PC will remain off.

    Oh, and I plan on buying a MTH (?) cable for the note so I can plug it into my TV and watch streaming TV in HD. I never bought a Windows Media PC, and now never will.

    Ballmer thinks he can grow Windows to take over the tablets, and Apple/Google believe they can grow tablets to take over Windows, two of those companies grew market share enormously quickly and one lost market share.

    You said this:
    "In America, at least, 99.9% of the people who own an Android phone or iPhone own at least one desktop PC, laptop, or both IN ADDITION to their phone."

    You can pretend the iPad is a complement to the PC, but they are both just general purpose computing devices that overlap. I bet they bought the iPad despite owning a PC. Not the PC despite owning an iPad.

    1. Re:Facetime by Anonymous Coward · · Score: 3, Interesting

      Insightful?

      Maybe if your work doesn't require using word processors, sticking numbers into spreadsheets, spend the whole day coding, or similar things, then... yeah... I guess a tablet is as good as any other general purpose computing device for work-purposes.

      It's funny that you mention the iPad, though. The other day, my boss couldn't review a document I sent him (just, you know... open the document and read it; no changes from him required) because "I just have my iPad with me, and I can't open it here". So... yeah... here, have an anecdote. Make of it what you will.

      Also, it's funny that you try to argue against GP's claim that the vast majority of people who have tablets also have a desktop/laptop. First, your personal case actually gives credence to his side of the argument: you do have/use a PC for work. Yeah, sure, you can put your tablet in a dock and attach a keyboard and call it a "general purpose computer" (technically, you'd be right), but it still doesn't make it one. In the case of the iPad, the meaning of "general purpose" gets changed to "whatever Apple lets you do with it". Can I compile code from within iPad? No? Then... sorry, you're wrong.

      I bet they bought the iPad despite owning a PC. Not the PC despite owning an iPad.

      Wow, so brave. Well... I wonder why? Is it because desktops/laptops precede tablet computers by a few decades? Who knows? But... hey... let's bet. It's fun!

      Trust me... someone that owns an tablet and doesn't own a desktop/laptop probably has no worries regarding silly things like "working" or simply have a job that doesn't require actually working with computers (for example, a point-of-sale thingie... sure... that could be done on an tablet): they're probably someone whose idea of using a computer is "facebook", consuming media and little more.

      tl;dr: You think people can work on tablets as if they were "general purpose computing devices" because your work doesn't actually require a "general purpose computing device" (a "special purpose computing device" works just as well, apparently). In the real world, lots of people actually need "general purpose computing devices" to get work done; sorry to inform you.

    2. Re:Facetime by Miamicanes · · Score: 2

      > There is no reason a tablet or smartphone cannot be connected to a docking station containing a keyboard and large screen,
      > have a dock at work, a dock at home and use the touchscreen everywhere else...

      Rrrrright. Let me know when a best-of-breed ARM can run even half as fast as Intel's best Xeon, and keep running that fast for more than 3 minutes without thermal management kicking in when used in a typical mobile phone or tablet.

      An 8 year old 1.6GHz Pentium M would completely spank a shiny new 1.4GHz Exynos, and beat it like the wife of a drunk guy on some cheesy reality TV show involving cops and trailer parks. In real performance, the highest-end Android phone money can buy today is approximately comparable to a 750MHz high-end corporate laptop from 2004.

      The rumblings are just beginning, but users over at XDA have slowly been discovering new phones & tablets that really can't run at full speed, all cores & guns blazing, for extended periods of time. Bug reports from users reporting games that radically drop framerates and slow down at somewhat unpredictable intervals after more than a few minutes of punishing the system as hard as the game can push the GPU are commonplace, and the intersection between the two arrives first at XDA when users defeat the phones' speed governors to let them play games at maximum performance only to see the phone hang & crash after just a few minutes. I expect regulators to notice any day now, and the outcome isn't going to be pretty. The last time manufacturers tried selling computers that couldn't run 100% at their advertised speed for extended lengths of time, the FTC smacked them down pretty hard for false advertising. That's part of the reason why many new phones can be trivially overclocked to insane speeds like 1.8GHz or more, as long as active thermal management is left enabled & you're doing things that require short bursts of instant gratification instead of long periods of back-breaking sustained labor. The chips themselves could go faster in a PC-type environment, but nobody is crazy enough to try and sell a phone that needs a fan to cool the CPU & GPU.

      Of course, there's no reason why the docking station can't have additional CPUs, and a faster GPU, except then the bus between the CPU and ram becomes an intolerable bottleneck, so you give the docking station its own ram as well. Then you realize that even the most ghetto 1x PCI Express SSD would completely spank the transfer rate you get between the phone's internal flash and the dock, so you add a local SSD and move a cached copy of the operating system to the dock as well. Congratulations, you've just created a laptop that's tethered to a phone & uses it for internet access and as a big, expensive flash drive.

      Then, one day, in a restaurant, someone grabs your phone from the table. Or you drop it onto the pavement in a parking lot while trying to get into your car on a rainy day. Or drop it in the toilet while trying to tweet and pee. Or any of the other 200 ways a phone can get destroyed/lost. Thank ${deity}, you had a full backup online. Except if you're going to spool everything to online realtime backup, why do you even have to bother with the phone at all? A real computer could just dispense with the phone, keep itself sync'ed up to your online copies, and dispense with the ceremony of tethering the phone in the first place. And we've come full circle... a phone that lets you access your desktop PC's data on the go, but is really just your fallback access device to use when you don't have your desktop PC around.

      Insofar as "proprietary formats" go, pray tell what popular consumer formats you're talking about? The only problems I've ever had using NTFS filesystems or NetBIOS shares with Linux involved Vista Home and an embedded Linux appliance with an old version of Samba that didn't know how to authenticate to it. DRM-protected WMP? OK, maybe... if consumers actually used or cared about it, which they don't... which is why nobody actually uses

  35. AC stupid as always by SmallFurryCreature · · Score: 3, Informative

    Who says anything about making money? Guess AC doesn't know what market share means.

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    1. Re:AC stupid as always by Anonymous Coward · · Score: 2, Informative

      If you're talking about just userbase, Microsoft has a hell of a lot more than that. Windows has over a billion users worldwide. No other operating system even comes close to those numbers.

  36. Re:More like 72% lost share by jbolden · · Score: 2

    Technologies can substitute for one another.

    Lets assume we have family father mother + 2 kids:

    2005:
    Dad own a windows laptop replacing every 3 1/2 years (.3 windows licenses a year)
    Mom has a netbook replacing every 2 years (licenses are say 1/2 priced so .25 licenses a year)
    The 2 kids share a desktop which is changed every 5 years (.2 licenses a year)

    Total = .75 licenses / year

    2015:

    Dad own an Apple laptop replacing the windows version every 7 (.15 windows licenses a year)
    Mom has a tablet replacing every 2 years (0 windows licenses a year)
    The 2 kids mainly use their phones but sometimes share a desktop which is changed every 7 years (.14 licenses a year)

    total = .3 licenses / year

    That's a big drop.

  37. Re:and it's going to get worse due to market force by jbolden · · Score: 3, Insightful

    I remember the same arguments being made in the early 1990s by the people who were really using workstations about those x86 "workstations"
    I remember the same arguments being made about a decade ago about laptops
    I remember the same arguments being made about mainframes and minis to client server.

    Phones and tablets are about a decade behind laptops in terms of computational power. I most certainly did use /. in previous years on laptops which have less CPU, Ram and storage than my current iPhone. And I can see lots of way to resolve the keyboard problem, just look at how much voice is genuinely being used already.

  38. Re:More like 72% lost share by Compaqt · · Score: 3, Insightful

    Just one problem with that: In the past the one big pro for Windows was that it ran your apps from way back.

    The Metro tablets don't.

    Now, given that you're going to have to buy all new apps anyway, you've got a choice, whereas previously you didn't:
    1) iOS: a whole lot of apps, and easy. Millions also have it.
    2) Android: a few less apps, a little more geeky. Millions also have it.
    3) Metro: starting out from near zero apps and zero market.

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  39. Re:More like 72% lost share by Miamicanes · · Score: 2

    True, but the developing world was never a profit center for Microsoft, anyway. If Microsoft sold N copies of Windows in the developing world 5 years ago when there were N/100 smart phones, and today sells 1.7 x N copies of windows when there are 250 x N smart phones now, they might have had their market share in the developing world decline to a negligible percentage, but they're still selling 1.7 times as many copies as they were before.

    Yes, we get the point. A desktop PC is gross overkill for facebook and twitter. Microsoft's suicidal strategy is that it's trying to bridge the gap by eliminating the one strategic advantage desktop PCs will always have over mobile devices -- raw, unapologetic power, and the ability for users to run anything they damn well feel like running, instead of being jailed in a walled garden and told what they're allowed to do. Microsoft has forgotten its own history: PCs weren't so much a more powerful alternative to mainframes as much as they were a way to do an end run around bureaucracy and arbitrary restrictions on what you could do. They were corporate middle America's way to give the mainframe folks the finger, take matters into their own hands, and show what they could do when 17 layers of IT bureaucracy were avoided. Microsoft has spent most of the past 20 years trying as hard as it can to abolish its original rationale for existing by re-empowering the Enterprise over individual users.

  40. I don't think those words mean what you think by atlasdropperofworlds · · Score: 2

    And how many Windows 7 licenses have been issued to date? 600 million? Different markets, different sales slopes. iPhones don't replace PCs for the overwhelming majority.

    Also, check your numbers.