Thursday, January 22, 2009

Microsoft Is Dooooooomed!

Actually, despite the seeming sarcasm, I do believe this. Microsoft is "doomed" (for some value of "doomed").

I've seen it coming for a while. I was in the trenches during the O/S wars (both in the '80s and the '90s) and one thing was apparent: Microsoft's power came from marketing--their monopoly (or near monopoly)--and not from technology.

People talk like Vista is a novelty, but Microsoft has a long history of releasing products that are so bad, that if a company without a monopoly had released them, they'd go out of business. In fact, most of Microsoft's competitors were killed by mis-steps much smaller than Vista.

Consider how many tries at Word, Excel, Access, Internet Explorer, DOS, OS/2 and Windows were needed to gain any kind of traction in the marketplace. Consider that OS/2 needed to be removed from their hands before it could take off, and they were so scared of it--a product competing on actual technical merit!--that they hired people to go on the web and lie about it. Consider that the Xbox is doing okay as long as "doing okay" doesn't need to include ever making a profit.

Consider how much trouble Microsoft created to interfere with their competitors--at the expense of their putative customers.

For that matter, consider who is responsible for unleashing upon the 'net an OS that could be so easily enslaved--and was by default, easily enslavable--that now millions of zombie machines churn away sending spam, orchestrating denial-of-service attacks, and generally marring the greatest innovation of the computer era (the Internet).

And why? Because it's way easier to collect the money for a monopoly than it is to support the people you force to pay you. Microsoft wanted the cash from all those people wanting to e-mail photographs and buy stuff from Amazon, but they sure as heck didn't want the responsibility.

Which is interesting, in its own way, because if they had--if they had taken it upon themselves, they'd have a nigh-indestructible brand. An entire generation of customers would love them to their graves.

When you have a monopoly, all you have to do is out-wait your competitors. And when you're in the magical position of your competitors being your customers, well, you can drive up their costs in all kinds of creative ways, like promoting standards and forcing them to invest in them, and then later dropping them. You can be a "partner" and then steal their code. If you can't steal their code, you can take their employees. Ideally you can do both.

You can drop your prices because you don't need to make money on any given product. In fact, in preserving the monopoly, you don't have to charge for anything if it secures that monopoly. (That's certainly the motivation behind the Xbox.) Once the competition is out of the way, you can stop putting money in to that product.

And life is good--as long as you can maintain the monopoly.

In tech, though, you can't. You can suppress new technologies for quite some time. But not forever. And if your strategy involves destroying other businesses by depriving them of money, you're in trouble if products arise to compete with yours from business models that aren't dependent on revenue from products.

And here we are. Why should anyone pay for an operating system when perfectly good ones are available for free? Why should anyone pay for office software, when perfectly good ones are available for free, and give you more freedom?

IBM was in a similar position 25 years ago, except their competition came from hardware getting cheaper. And ultimately their hard-earned monopoly--way harder earned than MS's, which started with IBM giving them barrels of money--crumbled and they had to reposition themselves as consultants.

Make no mistake, the monopoly money will keep pouring in. These difficult economic times, however, are going to have people looking sooner rather than later at "the Microsoft tax", and increasingly low-end hardware like netbooks are going to make the "free" in "free software" more appealing.

Eventually, MS is going to have to retreat to the niches it once assigned its "partners".


  1. They are going to lay off 5,ooo people and that's no joke.

    It will be bad for everyone.

  2. It's the tech sector; I'll probably be among the persecuted.

  3. My brother, an independent contracter and systems security administrator (I think that's what it's called.), is staving off his own persecution by taking on projects in every department at the company he's been working for and, for the department with the bad coffee, having good coffee delivered weekly.

    And I agree, MS alternatives are definitely looking better these days to the average user.

  4. Security is a good racket.

    One of my specialties is automation. I could go into just about any medium-small or bigger business and save them time and money and/or increase production.

    I've done it over and over again. Yet it's a surprisingly hard sell.

  5. My husband and I have ranted about MS for years now. Working on a PC really feels like working on something cobbled together by a lazy, incompetent bureaucracy.

    I'd be really curious to know if any of MS's strategies and tactics align with those of Blockbuster Video. Both of these companies really stand out to me as undeserving monopolies. They use unethical practices (or at least dirty tricks) to kill all the competition, and then rule in egregious mediocrity. So many good video stores have been killed by Blockbuster, who is guaranteed to have 90 copies of "The Wedding Date," but doesn't carry any number of classics.

  6. The attitude is doubtless similar, but Blockbuster is doomed in the far shorter view.

    If they had an ounce of brains, they'd be Netflix.

  7. If they had an ounce of brains, they'd be Netflix.

    I know!! The fact that they missed the boat on that is reason enough for them to die. Speaking of which I just saw a bumper sticker the other day that looked just like the "Best Buy" logo but it said: "Must Die". BB is no one of my faves either. We go out of our way to get all electronics, etc. online just to avoid it.

  8. I find Best Buy interesting. They had this strategy of alienating low-end customers--I think it was the WSJ where they talked about it.

    I don't think it worked out for them.

    Have you seen the Improv Everywhere Best Buy stunt?

  9. Oh, it's funny stuff.

    Check it.

    The Times Square "performance" was probably my favorite of theirs, though.

  10. Thomas Crown Affair! Thomas Crown Affair!


  11. Yeah, I kind of think society's okay as long as people can pull whimsical stunts like this.


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