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Although Microsoft Corp. (NASDAQ: MSFT) has much of the business world wrapped around at least some of its software, the largest software company in the world is mostly known for its consumer products. Names like Windows, Zune, Windows Mobile, Sidekick, and Xbox are household terms (well, in gadget households perhaps).
Still, with all those names, why hasn't Microsoft formed some kind of overall consumer ecosystem so that all these products fit, work, and play together seamlessly?
Good question. One thing competitor Apple Inc. (NASDAQ: AAPL) has going for it is that it ties almost all its products together into a tight unit (even if not all are used) and controls the hardware and software experience tightly. Call that an extremely closed and inflexible fabric, but it works: Apple is definitely on top of its game, more than any time in its 30-year history.
Why is that? Apple has control. It responds to what customers want: simplicity and the "just work" attitude. Who has time to put a bunch of ill-fitting puzzle pieces together? Consumers want the puzzle pieces already glued together and hung on the wall in a display case.
PC Magazine highlights just how disparate some of Microsoft's consumer business units are acting. It seems there are "many Microsofts" operating these days, with little to no communication or integration between them. This theory lends this question: why would a company with tens of billions in cash and one still making billions every quarter be in a virtual standstill compared to competitors like Apple and Google Inc. (NASDAQ: GOOG)?
Apple may not sell as many PCs, but it does not have to. Google may not have a PC operating system (yet), but in the mobile space it is leaving Microsoft in the dust. Why has the fire gone out under Microsoft's behind? Nobody seems to be able and answer that question.
Although the recent Windows 7 product is, by and large, garnering very positive reviews, Microsoft needs to be hitting on all cylinders on way more than just one product.
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Reader Comments (Page 1 of 1)
10-30-2009 @ 2:22PM
Iridium said...
Simple and very easy question to answer.
When people buy a PC they are not buying Microsoft, they are buying Dell, Sony, Toshiba, Acer, etc.
They associate the computer with the brand, not the software. Also when you buy a PC you are buying a computer with Windows, not Microsoft Windows.
There essentially is no Microsoft branding. People also do not really decide to buy Microsoft, they are in essence forced to. People bought Office because they used Office at work. They bought a PC because they didn't want compatibility problems, not because they had to have a Microsoft product.
Apple on the other hand is associated with the product they sell. People don't say, I'm buying snow leopard or OSX. They simply buy Apple and they want to buy Apple.
If you look at the Zune or Xbox you quickly notice that the Microsoft branding is hidden or non existent. There are many people who buy the product not even knowing that it is made by Microsoft.
Microsoft is essentially a commodity name and not truly a product of the consumer landscape. That is why they can;t really light a fire to pick up a new OS like Apple can with a new iPod.
10-31-2009 @ 6:00PM
thedude said...
You're also ignoring many of the legal constraints placed on Microsoft. Whenever Microsoft products work too well together the EU (namely France) immediately launches a lawsuit against them, and incredibly the govenment inevitably sides with itself instead of the defendant MS.
Microsoft is probably the only company that is legally required to make its products as incompatible with each other as possible.
This is mainly due to fear that MS has an unfair advantage in the marketplace due to it's scope of use.
If Apple were to increase it's market share by maybe 1000% they might also find themselves being yolked by regulations. Probably more so based on the fact that they control every aspect of the Apple computing experience. Hardware/Software/Phone Applications all strictly controlled by Apple. As it is the only reason why Apple gets to do the things it does is because they don't have a large enough user base to merit excessive governmental intrusion. Of course, if too many governments recognize just what enomous profits Apple is pulling in they will be seen as a cash cow and the lawsuits will start pouring in.
Government doesn't even need to win all they have to do is be a big enough pain to merit a "settlement" and they can begin pulling a few hundred $million$ per year out of Apples coffers.
Granted MS was getting a little too big for their britches intentionally causing alternate vendor programs to not work as well with their OS. But this is also Apples Modus Operandi.
It seems that anything MS does generates a lawsuit and another round of $billion$ dollar settlements.
Who knows what the government is doing with the money but you can be damned sure it is in no way benefitting taxpayers.
11-01-2009 @ 8:55AM
e.krabs said...
As stated above, Microsoft is a much larger ship to turn and have a much broader diversity to products and services to juggle.
I also think that "cult of personality" plays a role here. With Apple, Steve Jobs has exerted a tremendous amount of control. Enough to turn the company into a single, homogenous entity. I really doubt that Steve Ballmer has that same level of control over his much bigger ship....
To be fair though, they do try. After all, Windows Media center works with the Xbox, and the Zune has its Zune marketplace, which some seems to love the subscript model....
But yes, I think we all agree that it's not cohesive like the way Apple is.