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Thursday, May 26, 2005

Has Microsoft's lost focus?

Apple Matters

"Longhorn has been denuded, delayed and derided, MSN search is a pitiful attempt to capture a small wedge of the search market, the iPod and iTunes still reign supreme in the online music arena, Intel bigwigs are saying odd things and the public regards the company as a whole with disdain usually reserved for cable providers (a necessary evil to be tolerated). All this adds up to a tense Redmond campus where corporate Officers deviate from their presentations to take worthless swipes at the competition and employees post less than enthusiastic blogs about working at Microsoft.

The negative feelings about Microsoft and within Microsoft have many people thinking that this is the moment in time where the giant will finally crumble. Apple will own the media market, Google will become synonymous with the internet, Linux will power all servers and the Xbox 360 will be stillborn in anticipation of the more powerful PS3. Microsoft will be left collecting scraps, eking out a few billion here and there, still profitable, but no longer the ultra powerful corporate monolith it once was.


Taking the operating system arena first we’ll note that the only two semi viable challengers are Linux and OS X. Linux, one supposes, will rule the computing world when the average citizen in India and China are computer owners but that day is still in the future. For first world residents paying the “Microsoft tax” is not considered a burden. You get to keep your old software, the interface retains some familiarity with each new upgrade and your peripherals just keep chugging along. Switching from Windows to Linux, for most people, seems ridiculously wasteful (what about all that software they pirat…errr purchased) and hopelessly difficult. Making the move to the Mac is less difficult technically but more costly in terms of hardware and software. And, truth be told, even if people started switching en masse to the Macintosh Apple wouldn’t be able to make enough computers to make a serious dent in the Windows for quite some time.

The same factors hold true with digital media delivery. Right now the iPod and iTunes hold the top spot. It is easy to see why: the two integrate seamlessly, the DRM is nearly translucent and the whole package offers consumer’s a great deal of convenience. Add to those advantages the cachet that the iPod is simply cool and you’ve got a hard to beat combination. Still when Longhorn rolls out (at this rate it will be right around the time the iPod’s cool has worn off) and Microsoft makes other players easier and more convenient to use than the iPod and iTunes one might expect the market to begin slowly shifting. iPod sales will likely always represent a significant chunk of the .mp3 player market but others will start getting a bigger slice of the pie.

Which leaves us with console gaming. Here it is easy to think that Microsoft has lost the war. The PS3 seems more impressive than the Xbox 360 so one would expect Microsoft to get soundly thumped in this arena. That will probably be the case for this generation of consoles but expecting Microsoft to lose the consoles wars long term is wishful thinking by the Microsoft haters out there. Consider how incredibly fast console makers can rise and fade, Atari once ruled that particular domain but they fell swiftly when Nintendo offered a superior product. Nintendo battled Sega for quite some time and then both were suddenly trumped by Sony. Clearly, in the console market, all it takes is one system and a few exclusive must have games for a console maker to dethrone the current king of the hill. Microsoft is still honing their game (so to speak) in this area and one supposes that it will be only a matter of persistence until they rule this market (however briefly). "

This is a scathing article by Chris Seibold about MessySoft. I can't say that I agree 100% with him, but the author brings up many good points. I have thought for quite a while that MS seems to be stretching it'self a bit thin. As stated in the full article, MS will not just whither up and die, but I do believe their best days are behind them.

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