Year: 2012

For many years Microsoft was the 800lb gorilla of technology, a titan among small fry, not just the largest technology company but such a king that could hold sway over all of the market. That gave us such gems as this: “Minding your Microsoft Manners.” [rcpmag.com] The palpable hubris is, in hindsight, the problem. Pride goeth before a fall.

When Apple knocked them off of the top of the market cap, revenue and profits hills many of them do doubt were telling themselves it was a fluke, a fad, a bubble. But now not only is Apple worth well over twice what Microsoft is, but Google has knocked them out of the second spot. Google! The company that Microsoft CEO Steve Ballmer swore he was going to kill in that legendary chair throwing incident eight years ago [theregister.co.uk] has grown over three times in size while Microsoft stood still and has bested him. As if that weren’t enough, IBM has been in its customary patient, persistent, conservative way building itself up until it is ready to put Microsoft even out of the third row in “Technology Companies by Market Capitalization”. This on the eve of the largest simultaneous refresh of Microsoft’s products in its history: new versions of Windows, Server, Office, Mobile, gaming products, the expected success of which the market has already priced in.

This is no longer the giant that others dread.

Microsoft’s fall from dominance goes really hard. They are still in denial, demanding things they are no longer entitled to. It affects their partners too. Their longtime partner HP remains loyal despite the fact that Windows PCs make them no profit to speak of, and aren’t expected to in the next few years, and HP has been scrambling so fast for so long that literally every other option has been floated but still the company stock is trading at lows not seen in a decade and analysts are calling for a breakup of the company, or doom inescapable. What could make HP act this way when there is no profit in it, nor hope of any? Dell is just as bad off – in the midst of the 2008 panic their stock fell lower than today, but there’s no panic today and their shares today traded at an annual low, and the company’s market cap is about one third of where it was a decade ago. And then there’s Nokia. We all know what’s happened to Nokia in the last few years. The only Microsoft partners doing well these days are ones like Samsung, Asus and Acer who keep them at arm’s length and are participating in the mobile revolution Microsoft somehow missed.

The world has changed. We don’t need to mind our “Microsoft Manners” any more. That is the really, really big deal.

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