Microsoft

Microsoft Reorganizes Itself – Crafty or Confusing?

This is a very nice summary of most Microsoft’s problems today, covering falling PC sales, mobile growth, tablet failure, Xbox, Office and Windows 8. Half the value of the article is in the links to external studies and references.

Everyone knows PC sales have started dropping. IDC recently lowered its forecast for 2013 from a decline of 1.3% to negative 7.8%. The mobile market is already larger than PC sales, and IDC now expects tablet sales (excluding smartphones) to surpass PCs in 2015. Because the PC is Microsoft’s “core” market, producing almost all the company’s profitability, declining sales are not a good thing.

Microsoft hoped Windows 8 would reverse the trend. That has not happened. Unfortunately, ever since its launch Windows 8 has underperformed the horrific sales of Vista. Eight months into the new product it is selling at about half the rate Vista did back in 2007, and that was the worst launch in company history. Win8 still has fewer users than Vista, and at 4% share a tenth that of market leaders Windows 7 and XP.

Product Management vs. Program Management at Microsoft

Product Management tends to be about answering questions such as why a product should be built and what features should be added to existing products. Program Management is more about answering questions such as when features should be delivered and how they should be exposed to customers. Depending on the division at Microsoft program managers may have more or less influence than product managers on answering the questions about what features are built.

Really, FairSearch?

Apparently, there is a new kid on the block – FairSearch.org. Here is a quote from their About page:

FairSearch.org is a group of businesses and organizations united to promote economic growth, innovation and choice across the Internet ecosystem by fostering and defending competition in online and mobile search. We believe in enforcement of existing laws to prevent anticompetitive behavior that harms consumers.

Further down on the same page is the list of companies involved. Among them, some of those that should not even be allowed to use the word ‘fair’: Microsoft, Oracle, Nokia.

So, this bunch of clowns (my apologies to the clowns) tried and failed to control the web search and the mobile markets, and now they are trying to bring Google down by joining their forces and attempting a government campaign. Pathetic! Here is what they write to the EU:

Google’s Android is the dominant smartphone operating system, running in 70% of units shipped at the end of 2012, according to Strategy Analytics. Google also dominates mobile search advertising with 96% of the market, according to eMarketer. The complaint says Google uses deceptive conduct to lockout competition in mobile.

“Google is using its Android mobile operating system as a ‘Trojan Horse’ to deceive partners, monopolize the mobile marketplace, and control consumer data,” said Thomas Vinje, Brussels-based counsel to the FairSearch coalition. “We are asking the Commission to move quickly and decisively to protect competition and innovation in this critical market. Failure to act will only embolden Google to repeat its desktop abuses of dominance as consumers increasingly turn to a mobile platform dominated by Google’s Android operating system.”

FairSearch is an international coalition of 17 specialized search and technology companies whose members include Expedia, Microsoft, Nokia, Oracle, and TripAdvisor.

Google achieved its dominance in the smartphone operating system market by giving Android to device-makers for ‘free.’ But in reality, Android phone makers who want to include must-have Google apps such as Maps, YouTube or Play are required to pre-load an entire suite of Google mobile services and to give them prominent default placement on the phone, the complaint says. This disadvantages other providers, and puts Google’s Android in control of consumer data on a majority of smartphones shipped today.

What a load of bollocks! Google Android devices aren’t all built by Google. In fact, the majority of Android devices are shipped by other companies. Are all of them producing below the cost? Of course not. That would just be stupid. Secondly, Android is very much based on the Open Source Software, Linux and such. I’m guessing that’s one of the main reasons it grows so fast and is cheaper to make. Microsoft, Nokia, and Oracle are well-known foes of Open Source. But guess what, it’s not up to them anymore. People vote with the wallet. The choice is here, and people can finally buy the devices that they like, not the ones that are being shoved down their throats.

And as far the as the web search goes, that’s even more pathetic of a subject than mobile. Just build a better search engine and people will switch over. It takes nothing, absolutely NOTHING, to use a different search engine. But the truth is, Google is by far superior search engine to Microsoft’s Bing or anything else that popped up recently. Result manipulation my a$$. If people who use the search engine will lose trust in the results, they’ll just leave. But as long as it works, who cares really?

Microsoft has failed

Microsoft is largely irrelevant to computing of late, the only markets they still play in are evaporating with stunning rapidity. Their long history of circling the wagons tighter and tighter works decently as long as there is not a credible alternative, and that strategy has been the entirety of the Microsoft playbook for so long that there is nothing else now. It works, and as the walls grow higher, customer enmity builds while the value of an alternative grows. This cycle repeats as long as there is no alternative. If there is, everything unravels with frightening rapidity.

Read the whole thing – it’s a really good summary of where Microsoft stands today.

For many years Microsoft was the 800lb gorilla of …

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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