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How Does Microsoft Avoid Being the Next IBM? (arstechnica.com)
An anonymous reader quotes a report from Ars Technica: For fans of the platform, the official confirmation that Windows on phones isn't under active development any longer -- security bugs will be fixed, but new features and new hardware aren't on the cards -- isn't a big surprise. This is merely a sad acknowledgement of what we already knew. Last week, Microsoft also announced that it was getting out of the music business, signaling another small retreat from the consumer space. It's tempting to shrug and dismiss each of these instances, pointing to Microsoft's continued enterprise strength as evidence that the company's position remains strong. And certainly, sticking to the enterprise space is a thing that Microsoft could do. Become the next IBM: a stable, dull, multibillion dollar business. But IBM probably doesn't want to be IBM right now -- it has had five straight years of falling revenue amid declining relevance of its legacy businesses -- and Microsoft probably shouldn't want to be the next IBM, either. Today, Microsoft is facing similar pressures -- Windows, though still critical, isn't as essential to people's lives as it was a decade ago -- and risks a similar fate. Dropping consumer ambitions and retreating to the enterprise is a mistake. Microsoft's failure in smartphones is bad for Windows, and it's bad for Microsoft's position in the enterprise as a whole.
... killed IBM and Microsoft and Mobil Oil.
I worked for Mobil. They bought their own insurance company and became self-insured and got into the business/consumer insurance business. They also got into real estate. They built Reston, Va. from the ground up.
They also bought Montgomery Ward and stuff.
Now they are gone, absorbed by Exxon.
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Too much money causes businesses to look for ways to spend the cash in pursuit of CEO and shareholder greed.
Today's capitalism calls for asymptotic growth in periods measured in nanosecomds.
In this regard, Apple is next.
Apple has more ash than God and has no visionary (Jobs) to guide them as to how to spend it.
It little behooves the best of us to comment on the rest of us.
(ducks)
Look, the problem is how the market exists, and how it will change, not in how it used to be.
IBM rolled into services, having initially come from services.
MSFT started with OS and apps, but is fighting three different wars:
1. Tiny tech. Stuff that is so small nobody will ever pay for an OS for it. It's in the background. Do you ever think "oh, my new fridge and toaster need a fancy Kenmore OS, not some Braun OS". Nope. Wearables don't care. Only Apple (which amounted to a large share of MSFT apps market share, originally) has managed to make people pay for that.
2. Ubiquitous Linux blade servers. Nobody cares what your database and AI runs on. Oh, at trade shows they pretend they do, but IRL they don't. Cheap fast quick reliable wins every day.
3. Cell/mobile vs Desktop/Server. MSFT has never grokked cell or mobile. Ever. Still don't. They keep trying to chrome it up, and they aren't Apple, so it never works.
Thing is, you think MSFT gets most of their money from stuff and services they sell. They don't. They get it from all the bits and pieces of companies they own.
(caveat: many of my friends got rich off of MSFT or Apple or IBM, and my first house was from selling MSFT stock I bought below book value on Black Friday stock crash)
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One pesky fact about this fading business...
Quarterly Revenue:
June 30, 2005 10.16B
June 30, 2011 17.37B
June 30, 2017 23.32B
The idea that Microsoft is dependent on Windows revenue at this point is laughably out of date. They gave the last version away!
Of course they still rely on the lock-in that comes from Windows huge software library.. but Microsoft is less dependent on the OS than at any time in its history since it got into the OS market. Unless you count Azure as an OS.. all the eggs are going in that basket now. Office 365 is hugely important as well.
Microsoft has several billion dollar a year products now. Get with the times, people.