back to article Lights out for Microsoft 2.0?

Microsoft's conversion to Web 2.0 concepts like online, ad-funded services and software-as-a-service in the last few years have made it the oldest startup in town. Chief executive Steve Ballmer has evangelized search and advertising as his company's manifest destiny and, from chief software architect Ray Ozzie on down, has …


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  1. Jodo Kast

    They can be both

    Google can be an online ad company and a software company. Why can't MS?

  2. Anonymous Coward
    Anonymous Coward

    Another way of looking at it...

    If Microsoft is financially responsible of course it will control costs in tough economic times. But with its history of solid financial management and investing for the long term it might very well be that it is a winner in the bad times. Investing when others are afraid to do so is often a great long term strategy - and isn't long term what Microsoft does well?

  3. Anonymous Coward
    Thumb Up

    At last

    Less money for froth and guff stuff.

  4. Dave

    Pedant attack

    'Rein in', not 'reign in'.

    Sorry, couldn't help myself. :-)

  5. elderlybloke

    Nothing atoll

    My Christmas purchases will be about the usual level.

    My purchases of anything from Microsoft will be zero!

  6. Iain

    No no no.

    Microsoft have not got a hope of even being a blip on google's competition radar if they do not improve Live Search considerably. I sometimes accidentally use it at work (in IE the quick search is positioned in the same place as google in my FF) and it just doesn't work at all. I mean, it is really really bad, I cannot actually believe how atrocious it is.

  7. Brian Miller

    Hiring freeze? Maybe its "out with the idiots"

    Microsoft has made a lot of poor hiring decisions. Idiots abound, and I mean people that don't have a work ethic, don't know how to use Windows, and can't even type. There have been a lot of people complaining about the incompetence. Perhaps there will be hiring standards established, like, "smart and gets things done."

  8. The Mole

    Upgrade cycles

    I imagine what will bite microsoft the most isn't a consumer downturn but when companies suddenly start realising that they don't need to upgrade their 3 year old machines and that the existing versions of office work just fine. Companies have already delayed in upgrading to Vista and this downturn is likely to be another good reason not to bother upgrading.

  9. Paul Murphy
    Gates Horns

    hmm .. M$ expensive, Linux free hmm.

    Now I wonder why M$ might be concerned?

    Has anyone costed LAMP vs (lets see) WISV or WISA I suppose?

    Let alone Office(tm) vs OpenOffice(what no TM?).

    nope - I can't see why just yet - anyone?

    interesting times.


  10. sleepy

    maybe the loss making was learned from the past

    Interesting that MS is criticised here for losing huge amounts on trying to break into new markets. In fact, MS made huge losses for years while building their current monopoly, but this was concealed by embedding the activities in smoke and mirrors accounting.

    Now that MS is already huge, and Sarbanes Oxley and other changes make accounting tricks more difficult, the loss making on trying to build new monopolies can't be concealed quite so well. But Ballmer and Gates know exactly how they did it the first time around, and being relatively devoid of creativity they surely won't stop trying to buy monopoly control of markets they enter, while presenting success as due to product excellence.

    (Check out for some details of MS accounting ten years ago)

  11. Anonymous Coward
    Gates Halo

    "the cash generators - client, server, and office"

    They''ve traditionally been cash generators while the corporates have been willing to stay on the permanent upgrade cycle and the volume PC builders (and their captive customers) were willing to do the same and there was a credible retail upgrade market willing to pay a small fortune to MS to upgrade to new versions of software with genuine new functionality that didn't need expensive new hardware to go with it

    Are we sure any of that still applies? As I write this, Dell and HP (and probably others) are still selling desktop PCs with XP (what their server customers use is largely irrelevant here), and for the more adventurous home or SoHo market, plenty of respectable places are still selling legitimate OEM XP CDs. Meanwhile, the so-called "Netbook" (tm Psion) market still relies on XP (or, even worse occasionally, Linux). MS have already had to change their business model and product lifecycles to reflect that.

    In the Office market, the price of OpenOffice in the retail market is seriously hampering Bill's ability to rake in the volume dollars; either it's no sale at all for MS, or it's a greatly reduced price sale of Office Home+Student or whatever rather than a full retail version.

    In the corporate market, the Select (or Assurance or whatever) subscription model relies on IT departments etc being willing to pay MS (sometimes, pay a lot) to stay current. If what the business already has does everything the business needs, why would management want to pay MS on an ongoing basis when they could upgrade (and pay) occasionally on a planned basis if and when the new software offers business benefits which outweigh the associated costs (new hardware, new UI, new training for new UI, lost productivity...). (Don't say "support", "MS support" is an oxymoron).

    You can fool some of the people some of the time, but right now the sky is falling. Sell MS.

    Saint Bill's time is up. If we want him to do something useful, why not get him to bail out the failed western financial system with his own money while he can still afford it, because Joe Public can't pay won't pay once they find out what it's really going to cost them.

  12. Saul Dobney

    Missing the point

    So far off beam it is untrue. M$ has assets of $73bn and cash or equivalent of $23bn according to it's company report. Yahoo was going to be a cash purchase and they'd still have had plenty of money in the bank.

    It has been true that M$ has been trying to play catch up on search and websites and they have burnt money and failed big time so far. But the current SaaS direction for M$ is not about search or websites. It's beyond that and more about software and access to software and data - traditional M$ areas of focus. Software now has to work online and offline. Applications have to be available what ever the point of access. Data needs to be stored somewhere and sync'd between offline and online instances. Merge current desktop apps like Office so they are available anywhere and no longer device reliant and merge seamlessly into online storage, sharing and access and protection control. You rent apps, rent space, sign in for access and get advertising and private search across friends. That's the bet M$ looks like it is taking and would be expected to announce during the coming months.

  13. Joe K
    Gates Horns

    Same shit, different day

    MS have lost BILLIONS trying to take on Google

    MS have lost BILLIONS trying to take on Sony and Nintendo

    MS have lost BILLIONS trying to take on Apple/iTunes/iPod

    MS have lost BILLIONS trying to replace an operating system that never needed replacing

    If any company needs to learn the value of trying to NOT lose some money occasionally, its them.

  14. IGnatius T Foobar

    Good riddance

    Good riddance to "Microsoft 2.0" and all of their lame attempts at displacing Google and the various web startups. On the web, Microsoft can't leverage its monopoly. And in tough economic times, open source software looks very attractive compared to Microsoft expensiveware. (It's actually more attractive anyway, but well-funded PHB's often fail to see the value prop.)

    I sincerely hope that there are absolutely massive layoffs at Microsoft in the coming years, resulting in a surplus of developers who go on to continue building out the non-Microsoft ecosystem.

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