Microsoft on the Road to Nowhere

[Hooch Tan]

<div class='os_post_top_link'><a href='http://www.zdnet.com/blog/bott/a-closer-look-at-microsofts-lost-decade/2176' target='_blank'>http://www.zdnet.com/blog/bott/a-cl...ost-decade/2176</a><br /><br /></div><p><em>"And indeed, if you look at Microsoft&rsquo;s stock chart for the period in question, you see a nearly flat line, up only about 6%. The analysis is a little more favorable if you use the proper measure, adjusted closing price, which accounts not just for splits but for dividends and distributions. If you invested $1000 in Microsoft stock on January 2, 2001, and reinvested all your dividends, you have roughly $1,468 today, or a 47% return over nearly 10 years."</em></p><p><img src="http://images.thoughtsmedia.com//dht/auto/1275353255.usr20447.png" style="border: 1px solid #d2d2bb;" /></p><p>It was big news last week when word came that Apple's market cap surpassed Microsoft's.&nbsp; Unsurprisingly, fanboys from both camps started talking about the event in earnest.&nbsp; Behind this announcement, however, is an interesting tale of the PC industry in general.&nbsp; A lot of what writer Ed Bott makes sense.&nbsp; The PC has increasingly become a commodity with little differentiating competitors where Apple has branched out and remained as much a brand as a product.&nbsp; Ballmer definitely is being offered up as the sacrificial lamb for all that is wrong with Microsoft, though I wonder if Bill Gates would have done any better.&nbsp;</p>

[ptyork]

To me (looking from the outside in, of course), Ballmer has no vision and/or no guts. He seems to react to new markets rather than create them. Gates' problem was trying to bring visionary products to market before technology made them viable or without being fully baked. TabletPC's, Bob, UMPC's, Media Center, etc. But he had vision and the flaws in the execution of the vision were correctable. Ballmer has the uncorrectable lack of vision and seemingly does not foster the environment necessary to incubate (and importantly keep) it.

Where Microsoft leads, it does well. Windows is superb. Office is a market leader for good reason. Visual Studio and the rest of the development suite are best in class by a long shot.

But as a follower, it is very much an also ran. They are just too slow to react and don't execute well enough to make a mark in emerging . Zune is good but a resounding failure. XBox is good, but not great. Windows Phone 7 is unlikely to command a small percentage of anything. Live/Azure/etc...second tier player. Everything hardware == meh.

WAY oversimplified, but obviously they need to LEAD. Leading means innovation. Innovation requires vision and guts. Ballmer is NOT the right captain for this ship. IMO. :)

[ptyork]

Incidentally, the title is exceedingly apropos (not sure if you got it from somewhere or intended it as such). If Gates was "The Road Ahead", Ballmer is indeed the "Road to Nowhere". ;)