Is Microsoft dying?

“Is Microsoft dying? The health of established firms, especially great ones, is more difficult to diagnose. The balance sheet can give some clues, but, because it captures the recent past rather than the near future, it can fool you. Most veteran reporters look at more subtle clues, like the comings and goings of key employees, slippage in the release dates of new products (or missing features), and subtle shifts in the tone of company news releases, advertisements and executive speeches. But most of all, at least for me, there is the smell test: the faintest whiff of decay that comes from dying companies,” Michael S. Malone writes for ABC News.

“Great, healthy companies not only dominate the market, but share of mind. Look at Apple these days. But when was the last time you thought about Microsoft, except in frustration or anger? The company just announced a powerful new search engine, designed to take on Google — but did anybody notice? Meanwhile, open systems world — created largely in response to Microsoft’s heavy-handed hegemony — is slowly carving away market share from Gates & Co.: Linux and Firefox hold the world’s imagination these days, not Windows and Explorer. The only thing Microsoft seems busy at these days is patching and plugging holes. Speaking of Gates: if you remember, he was supposed to be going back into the lab to recreate the old MS alchemy. But lately it seems — statesmanship being the final refuge of the successful entrepreneur — that he’s been devoting more time to philanthropy than capitalism. And though Steve Ballmer is legendary for his sound and fury, these days his leadership seems to be signifying nothing,” Malone writes.

“Now the company seems to have trouble executing even the one task that should take precedence over everything else: getting “Longhorn,” its Windows replacement, to market. Longhorn is now two years late. That would be disastrous for a beloved product like the Macintosh, but for a product that is universally reviled as a necessary, but foul-tasting, medicine, this verges on criminal insanity. Or, more likely, organizational paralysis,” Malone writes. “Microsoft is still the dominant company in high-tech, the cynosure of all those things people love and hate about computing, the defining company of our time. It is huge, powerful and confident. But if you sniff the air, you can just make out the first hints of rot.”

Full article here.

MacDailyNews Take: We’d like to answer the headline’s question in bit of a sideways manner with a quote from WinInfo’s Paul Thurrott, “A Microsoft executive told CNET this week that Longhorn Beta 1 will ship by the end of second quarter 2005 (i.e., June)… According to my sources at the company, current build 5xxx versions of Longhorn look almost exactly like XP and don’t have many interesting new features. If Microsoft doesn’t pull a rabbit out of the proverbial hat soon, Longhorn is going to edge so far into joke territory that no one will be interested.” Thurrott’s full article here.

It seems that the odor of decay has finally gotten so bad that even the Microsoft Kool-Aid drinkers are now starting to report that something smells bad in Redmond. Moo.

90 Comments

  1. This can be viewed as a good thing, but does everyone realize the consequences of such an event as Microsoft tanking? The costs to the developed world will be far greater than the cost of keeping Microsoft on the machines. It would literaly cause economies to grind to a halt, especially ones that require many many IS man hours to keep Window machines running.

    We shall see….

  2. MacMan, keep in mind that even if Microsoft were to declare bankruptcy tomorrow, (a) there would be plenty of people to keep machines up and running, (b) someone would buy Windows source code–that’s a huge asset. Hell, there would probably be a major bidding war for that!

    No, Microsoft’s death will be slow and painful as passengers desert the sinking ship. As it should be…

  3. No, please don’t let it be. If MS falls, who will replace it? Please God not Apple. Corruption, stagnation and decay is the end of ultimate success. I’d rather have Apple continuing to bust their butts to create great, innovative and creative products that cater to an elite, exclusive market (like the educated, gainfully employed, creative sector that they currently attract), than become the new Microsoft/WalMart/McDonalds etc.

  4. [This can be viewed as a good thing, but does everyone realize the consequences of such an event as Microsoft tanking? The costs to the developed world will be far greater than the cost of keeping Microsoft on the machines. It would literaly cause economies to grind to a halt, especially ones that require many many IS man hours to keep Window machines running.]

    Story has it that one time, it rained for 40 days and 40 nights – and apparently the world kept spinning. It even had a few more bad days a little later, but kept spinning.
    ” width=”19″ height=”19″ alt=”wink” style=”border:0;” />

    Just keep remembering, change is the ONLY thing that is constant. And avoid any Chicken Little attitude.

  5. That’s a bit mean spirited.

    I wouldn’t say Microsoft needs to die.

    It just need not dominate the world market, and should settle into a place in reality with its functinality.

    Competition is good for everyone.

  6. I dislike MicroStink as much as anyone…but let’s be real…microsuck isn’t dying…it’s just getting old and decrepit.

    The most likely scenario will see MicroStink go through a painful and long slide until…and I hate saying this…they rebound similar to IBM.

    Or, MicroStink will simply breakup into parts…OS, Office, and the other crap.

  7. kj

    exactly…

    they put out shit, yes.. but their business sense is absolutely unparalleled

    they have NO conflict of interests… it’s about money. none of this Apple idealism, we want to put out stuff we’re proud of… ms is about MONEY MONEY MONEY.

    It’s no surprise that they have no ‘loyalists’

  8. Microsoft is getting old, and boring.

    There was this great old company called Woolworth, it lasted for dam near 100 years. It just died of old age.

    Microsoft has really worn people out.

    There’s only so much one can take.

  9. “They say software companies never die. They just swallow the competition with their enormous coffers and wait out the public scrutiny.”

    Tell that to WordPerfect. Or Lotus. Or maybe WordStar. Or maybe Aldus.

    Microsoft IS dying, but like any behemoth, it will take a long time to fall. But take a look at the security nightmare (which is Friday the 13th Part III – we still have many sequels left), the enormous delays on Longhorn for what will be a minor update to XP, etc….you have the beginning of the end.

  10. BM…. hmmmm…. now THERE’s a convergence of concepts!

    I don’t relish the demise of M$, imminent or otherwise – who would we love to hate?

    MW – “forces” – as in a future headline: The global marketplace FORCES M$ to reorganize as it sells off assets…

  11. Interesting take, BuriedCaesar. It’s true: if Microsoft dies or shrinks into obscurity, who will be the next enemy?

    I still remember when it was IBM, and Microsoft was considered mainly an early supported, albeit an unruly one…then Apple started using IBM processors, and Microsoft became the enemy…

    Maybe Linux would be a good candidate. After all, there is already an existing enmity between BSD and Linux which could be built upon.

  12. Don’t get too cocky.

    All Longhorn has to do is be good enough.

    While OS X has to be exceptional. Apple has little room for error.

    It will be a lot easier for the world to convert to Longhorn than it will be to convert to OS X.

  13. Microsoft aren’t an enemy of Apple. They are an enemy of every innovative company in the tech field. I think this is the main reason virus writers target MS. Yeah, Windows is easy to crack into, but it was only when the DOJ were seen as doing nothing to stop their demonic ideas about extreme capitalism (ie competitors must DIE!) that the security problems really started.

    Bad karma. They’ve stored up so much, and it’s coming right back at them.

  14. Microsoft is already dead… though they will keep on making billions – like an ageing rock group. Cause of death? (as always) they thought they were the hosts of the party and found out they were merely guests. Whilst they dance to their tune everyone else moves on to a new beat.

    The new enemy? APPLE – long live the enemy!

  15. Computers need to be completely redesigned. We need innovation and acceptance of new ideas. As a society. Apple is better, but the Mac is too complicated and based on awkward interfaces too.

    It will be good when MS is shoved aside. Maybe they will rebuilt thier Office suite so Apple doesn’t have to.

  16. Yes MS will die but it would be an AT&T kind of death. The worst kind in my opinion. It will begin selling its divisons and one day people will talk about it like they did about MaBell.
    But then again all things must pass. So don’t buy any flowers yet.

  17. Apple are a very good hardware design company, but they price their items as high as they can get away with. They often use older technology to keep margins high. Design though is paramount and keeps us interested.

    On the software site though, Apple have much to learn from their hardware design team. MUCH better than Winblows, but still not there. I know it takes a LONG time to build an OS, especially when it has to do so much. That’s the problem though.

    Can’t an OS do less, better? OS X is a monster. It’s very very slow on the UI and many other tasks. Apple should do better than this. Tiger will be better, but how much? Quartz and Aqua might not have been such a great idea. I think it was just what they had at the time and now we’re stuck with it. Pretty, yes, but sloooow.

    Ah, well, maybe the Cell processor will be the answer to all of this speed and flexibility problem.

  18. —But if you sniff the air, you can just make out the first hints of rot.

    Typical understatement — it’s been stinking to high hell for a while now. Gates was naked with Conan.

  19. That’s my point Knock Knock. I hope Apple achieve such a significant market share that ‘fans’ – such as many of the lackeys on here – will begin to feel confident enough to begin offering positive criticism of the company’s many faults (rather than the naff ‘underdog is best’ attitude).

    Faults such as the truly appalling inability for the OS X finder menus to live update (causing me hours of frustration opening the wrong files whilst the SLOW finder rearranges itself… and only then after I’ve clicked back into the menu. And faults like the crappy new Apple Mice. I’ve already dumped my new wireless mouse as virtually unusable (slow, HEAVY, and unresponsive), and am now about to replace my replacement ‘Pro’ mouse with my old trusty Apple ‘ball’ mouse. Why can’t Apple realise – with all it’s emphasis on ‘DESIGN” – that a mouse needs a feel of ‘traction’ beneath it for it to be have the same effortless ease as using a pencil? These new mice feel like skating on (thin) ice.

    The paradox is, of course, that no matter how zippy the new processors become – it’s all a wasted effort if struggling with flashy – but poorly designed – hardware and software make everything twice as long to do!

    Sometimes I yearn for the natural ‘ease-of use’ of OS9 and would trade any amount of much trumpeted ‘search’ facilities, window swopping, widgets etc etc to have this back!

    Signed,
    An Apple Fan.

  20. “The costs to the developed world will be far greater than the cost of keeping Microsoft on the machines. It would literaly cause economies to grind to a halt”

    That’s overstating the case somewhat; OK, a hell of a lot. The global economy really is like an ecosystem; something big dies, there’ll be a hell of a stench for a while, but then the carcass will provide sustenance for multitudes of smaller organisms. If Microsoft collapses dramatically, there would probably some temporary concern, but that doesn’t mean that their products would cease to operate as well. Entities dependent on MS software would continue to use them, then take their time to seek alternatives when the time came to upgrade their systems. This is the vacuum that other companies and technologies would step forward to fill.

    But a company of Microsoft’s size, with Microsoft’s managerial talent, and Microsoft’s mountain of cash ($64 billion and growing), doesn’t simply fall down like an old building, or dry up and blow away. If they refused to change and clung stubbornly to their core businesses, they could still afford to lose money for years before they had to fold up the tent. Warren Buffett once said that he would have no idea how to run Microsoft, but that he could put Bill Gates in charge of any division of any of his companies and be confident that they’d make money.

    If forced to change fundamently, Microsoft has the talent and resources to reinvent itself as a powerhouse in any of many fields, particularly as a financial instution. This is not as peculiar as it sounds, because in reality Microsoft now, today, is not a software company; they’re a profit machine. They have a truly colossal investment portfolio, with large stakes in many, many other companies, and they know how to manage information.

    If Microsoft breaks up into smaller companies, they could still be huge players. Look at what Standard Oil’s fragments became, Exxon, Mobil, Sonoco etc., and how powerful the Baby Bells turned out. During the DoJ’s pursuit of Microsoft, I remember one analyst saying his biggest fear would be if they dismantled Microsoft: “They’re going to break up a shark into a school of piranha.” If Gates maintains shares in the smaller companies, he could become even wealthier than before, as John D. Rockefeller did when he refused to sell his shares in the smaller oil companies. His reply to his advisers was that he was only casting many smaller nets instead of one big one, and he was right.

    Remember the ancient Arab proverb and be careful what you wish for. A fragmented Microsoft may well be more powerful and influential than a monolithic one.

  21. Too bad BeOS never caught on. In demos I saw years ago at MacWorld, it was better and way faster than OSX. Maybe Microsoft will buy it from Palm. I would switch from the slow dog Mac OSX to Be in a second.

  22. BeSmart,

    Be smart and stop dreaming. BeOS was far from finished, and it would take Microsoft, or any other company, years of further development to turn out a ready-for-prime time platform, as well as lure enough developers to make the platform worthwhile. This was the main reason that Apple chose to buy NeXT instead of Be. NeXT had an extensive and polished developer environment that Be could not match, and Apple realized that it would be easier to build on the NeXT’s BSD core and lure developers to the platform, no matter the technological and performance advantages that Be enjoyed. Be’s fantastic engineering team had the luxury of starting from a clean sheet of paper, so backward compatilibility was not an issue for them, as it is for Apple and especially Microsoft. Apple gambled that they had acquired a system that they could get out the door much quicker than Be, and then take the time to eventually match Be’s performance and features.

  23. I’m finding that people like me,long time windows users, are just becoming fed up with the exponetionally increasing time, money and effort needed to keep Windows running.

    I don’t see Windows getting any better for two or three years, if ever considering Microsoft’s track record. After considerable reflection I’ve decided that my present Windows machine is my last. It’s just not worth the effort to continue to use Windows.

    A lot of my colleagues have also become frustrated as performance of their Windows machines have deteriorated due to corrupt registry systems or malware. After going through the yearly ritual of reformatting and reloading once to often they have come to the same conclusion; it’s just not worth the effort and are switching to Apple when it finally comes time to replace the old computer.

    This is what’s going to kill Microsoft. People deciding it’s time to move on.

  24. Well, I don’t think M$ will totally collapse. I DO think they have hit and passed their high water mark on market share though. I would like to see Apple at between 10 and 20 percent market share. Big enough so that every major piece of software/game is ported, small enough that real innovation continues to occur.

  25. Apple had been beleagured for 20 years… why can’t Microsoft be beleagured while doing 36B in business?

    normal rational people are not saying that MS is dying.. what they’re saying is that they are becoming irrelevant in terms of innovation. They are becoming the K-Car of computer technology. it works, but with all the excitement of a colonoscopy.

    steve jobs said in 1996 ” If I were running Apple, I would milk the Macintosh for all it’s worth — and get busy on the next great thing.”

    <http://www.computerbits.com/archive/1997/1000/mac9710.html&gt;

    i do believe him when he says stuff now. because its taken 9 nears, and he’s executing better than anyone anywhere could ever have hoped for.

  26. The future is open source. Once Microsoft tanks, Apple (if they are still around too, chances look good) will be up against open source, everything thing you would never need will be free and everybody and their grandma can use the code to build a better program. Apple would probably have to end up making most of their things open source to survive, then survive on hardware sales and make their own flavor of open source OS and programs that people can use. Thats how I see things going.

  27. I actually think Microsoft makes some darn good software (i.e., Frontpage, Publisher, Office, etc.). While they remain the #1 reason why Apple has been relegated to a niche market, Mac afficianados can take comfort that Job is steering the ship in the right direction, and the future looks very bright. I don’t have this visceral hate for Microsoft, but I do think it’s unfortunate a superior technology has to struggle as a result of their monopoly. Ultimately, the consumers drive the market, and my hope is consumers don’t let the Mac go the way of beta tapes. It’s time the good guy wins for once.

  28. Time to fire the Chief Software Architect: All he’s been doing lately is giving away his monopoly money to charity. I think Carly could do better than Ballmer too … the place could do with some house cleaning. Think of what they wasted on R&D; what do they have to show for it? Half-assed businesses that aren’t class-leaders. Still dreaming of another monopoly home-run, eh? T’ain’t gonna happen again, sorry.

  29. ALL empires and dictorships come to an end eventually.

    It is inevitable.

    The Romans, Egyptians, Communism, Pan Am, Sony, HP, Napster, Real, Microsoft… RIP.

    From the ashes of these will come great things and move the human race forward.

  30. Dying? Maybe. And if so, it’s very slowly. It’ll take a decade or two.

    Losing its power on the market? Absolutely. The Microsoft threat isn’t what it used to be.

    And yes, despite Balmer trying to spin their disgusting, lawbreaking, bullying past, MS has pissed off too many customers and partners. Nobody trusts them, nor should they.

    And of course, who can forget their utter lack of quality and innovation.

    Yes, Microsoft has grown up to become a big, slow moving, bureacratic company. And they are finding it’s hard to dominate an industry when you can’t break the law anymore.

    But dying? I a little premature, but the article is directionally correct.

  31. Hey retro cat..

    here’s a thought…

    Yahoo Toolbar released for Firefox..

    why?

    Firefox has a mere 10% marketshare..

    Yahoo wants to help out the guys trying to take out MS.

    Can you see how Yahoo would benefit from IE losing marketshare..?

    Interesting angle.. one that does not look good for MS because less and less people are dependent on their ‘technology’..

    That being said.. it’s amazing for anyone to think MS is dying.. they’re making more money than ever

  32. This is a really stupid discussion. MS is a giant monster monopoly that will not die. It just makes tons and tons of money. It controls 9x% of the computer market.
    All the Apple heads see no problem of Apple dying at 2% of the market, why should MS worry? Someone is being delusional here.

    Once Longhorn comes out MS will pay off all the press (again), Jay Leno will be paid to crack some unwitty jokes about how cool Longhorn is (Is that the new MS operating system in your pants or a Longhorn? Both! har har har), the “in” music group at the time will star in a ad for it (in the back ground will be the brass section playing “Long Horns”) and the press will heap praise after praise upon it and the cycle starts over.
    New press will come out- can Apple and Linux survive???

  33. Sure Microsoft won’t just die, but its importance may well be waning. Just look at Firefox: The final version is now three months old, and it already has 20% share. I wouldn’t be surprised if in a year IE has been reduced to the irrelevance of Netscape.

    In Europe, governments are switching more and more to open source. Companies may well follow suit.

    Magic Word: growing – LOL

  34. Haruspex: “Firefox: The final version is now three months old, and it already has 20% share.”

    B.S.

    And so what if IE does drop in usage – MS makes no money off it. If Firefox has 10, 20 or 30% who cares?
    Apple Safari has about 2% – that must be really really terrible right?

  35. Hey Guys!!!! Don’t be FOOLED!!!!! This Michel “Phony” Malone is the BIGGEST M$ sellout in the whole humanity!!!! Now he is talking about M$ demise?? I can’t believe it!!!! This Michel Phony Malone was bashing Mac BIG Time in the early 90’s when Steve Jobs returned to Apple. One after another anti-Mac propaganda came from this jerk constantly for years but this shit head gradually faded away as Apple’s popularity grew. I am surprised he is still around and still writs for FOOD!!!! Only this time he switches from the DARK SIDE? I don’t think so!!!!

  36. Mass delusion has beset the zealots on MDN! Microsoft is going no where and it’s just a matter of time before Dark Lord Gates stamps out the remaining minor insurrection of Mac rebels from the face of the planet!

    Doomsday is coming, Mac Fools, and you will all suffer the wrath of us Wintel faithful when it arrives!

  37. Interesting article, I wondered if I was the only one to see that Microsoft’s lack of innovation could come to harm the company at some point.

    You have to wonder why, with all the money in the world and enough programmers on staff to populate the state of Washington it’s so hard for them (Microsoft) to write and ship compelling software that makes people stand up and cheer, wait in long lines in the rain, and open up their wallets or purses to buy.

    But then, you think about all the crippled or abandoned products from the Redmond Colossus and perhaps that’s where all the money and effort went. I mean, do you know anyone who loves their MSN watch, and their Windows CE pda and their MSN TV… wait, wait, I need to start up my tablet computer to finish my note… er, that is after I reformat it to get all the spyware off of it that got installed after the last service pack.

  38. “Well, I don’t think M$ will totally collapse. I DO think they have hit and passed their high water mark on market share though. I would like to see Apple at between 10 and 20 percent market share. Big enough so that every major piece of software/game is ported, small enough that real innovation continues to occur.” – Jack A

    I couldnt agree more, But they wont be going anywhere anytime soon…

    Feeling as in “MS has lost its feeling for creativity”

  39. Nomacforyou:

    Don’t write the final chapter in the Evil Empire’s triumph just yet. It might go something like…

    In a not so surprising twist, just as Evil Lord Gates is explaining how his plan for world domination is finally (at long[horn] last) coming to fruition, and the assembled masses of Wintel faithful (by that time it’s just two guys in [smelly] Star Trek T-shirts) waits for him to execute the final piece of code to banish the rebels (Steve, Andy, and a [not-so] small, vocal group of creative, gainfully employed, different-thinking, good guys) for all eternity, the Evil Empire’s Death Desktop is slowed to an agonizing crawl by 14 spyware components “calling home”, 29 “pop-ups” offering a trip to Las Vegas, free long distance, and 27 “specials” on “penis enlargement”, while a Trojan commandeers Entourage to send out 2.5 million viagra ads. Evil Lord Gates struggles to run ad-aware and MS’s new and improved proprietary anti-virus program, when…

    “This program has performed an illegal operation…”

    In the reflected BLUE light, Evil Lord Gates hangs his head and sobs…

    In the quiet hall the only sound is labored, disembodied, breathing…

    Evidently, Ballmer’s been dancing again.

    ” width=”19″ height=”19″ alt=”tongue wink” style=”border:0;” />

    ~M

  40. Dave H, and anyone else who noticed:

    Sorry, it was late. I meant Outlook.

    I’m still punchy from trying to regain my Dad’s HP Pavilion (about 10 hours over two days). I’m no expert and I’ve been exclusively Mac for a year now, so it was a slow, painful process (but he’s my Dad).

    He couldn’t find the restore disc, and didn’t want to wipe and re-install because he had important files from his business on there.

    Luckily, all seems to be well… If only I could get IE to play nice with Firefox. IE would not let me access the Firefox download page. After burning a disc on my Mac with the Setup.exe file, I was able to install it and when it launched… everything locked up.

    I finally got it to launch without freezing the entire system, but it is still unstable.

    Now Dad has anti-virus protection, fire-wall protection, and anti-spyware protection. Admittedly, he didn’t have this stuff before, but he didn’t know any better. I can tell anyone that high-speed cable without the above stated protection is a recipe for disaster (unless you have cable on a Mac, like I do).

    *ASIDE* Last night the lowly eMac with Airport Extreme and Earthlink High-Speed cable was “loping along” at a measly 4.7M according to Speakeasy (I still remember loving 44k and thinking it couldn’t get any better!)

    *ASIDE 2* Dad was struck (hard) by the fact that all of the software he bought to protect his pc cost about 20% of what a Mac mini would have set him back. His mini order is in the works.

    Sorry about the mix-up,

    ~M

    I haven’t included my Magic Word before, but there are many times it applies…
    living- “If you ain’t Mac’ing, you ain’t living”

  41. 1) Microsoft is going broke
    2) Microsoft Windows isnt compatible (even with itself)
    3) There is no software for Windows (in the apple store last week i couldn’t find more then 1 or 2 Windows software titles)
    4) You cant upgrade Hardware with PC’s (I cant get a geforce or ATI video card for my 286 running DOS, i have to buy a whole new PC)
    5) Windows is too expensive
    6) um…did someone say virus?
    7) malware

  42. It’s funny that M$ used to lead the entire computer industry, and now they’re struggling too keep up…
    Like the rest of America, they are obese and need to go on a diet…
    Ballmer first!!!

  43. 1) Microsoft is going broke
    2) Microsoft Windows isnt compatible (even with itself)
    3) There is no software for Windows (in the apple store last week i couldn’t find more then 1 or 2 Windows software titles)
    4) You cant upgrade Hardware with PC’s (I cant get a geforce or ATI video card for my 286 running DOS, i have to buy a whole new PC)
    5) Windows is too expensive
    6) um…did someone say virus?
    7) malware

    Is this satire? Please tell me Mac users arn’t this uninformed?

  44. By my last post I meant that most of the ignorant Mac users to which the previous poster had referred were posting under the name Ben.

    Clearly, the items listed in the obviously completely serious post by RadioMoscow are 100% factual. After all, only absolutely infallible journalists of unquestionable character and reputation post comments to this site.

    Every day after the school bus drops me off I log onto my Mom’s eMachine and feverishly review the comments on MDN. Never have I seen one with even the slightest hint of sarcasm or humor, so RadioMoscow’s post must be dead-on serious.

    Oops. Gotta go do my homework. Bye, dudes.

  45. Aw, man, that’s not cool. Please don’t post that kind of stuff as me or Mom will put MDN into the AOL filter, and then I won’t be able to chat with you guys at all.

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