Microsoft's Dismal Future

"Microsoft's Dismal Future" is the title of my most recent column on Forbes.com.  In it I compare Microsoft with such formerly great, but now struggling, companies as Xerox and Kodak.  Looking at all the Lock-in at Microsoft, Balmer's complete unwillingness to Disrupt traditional Lock-ins, and the total lack of White Space for new market projects - Microsoft is a very likely candidate to follow Silicon Graphics. Sun Microsystems, DEC and a host of other formerly great technology companies into the history books.  And it could well happen in less than a decade.  Don't forget, in 2000 Sun was worth $200billion - and now the company no longer exists!

If I gave you $1,000 and told you keeping it required you invest it all in Microsoft or Apple, which would you pick?  For followers of this blog, there can be only one answer - it has to be Apple.  While Microsoft has a great past, it has not been using White Space to exploit technology developments in new markets.  All go-to-market projects have been around Defending & Extending the traditional PC market.  With products like Vista, OS 7 and now Office 10.  But reality is that all of us are using PCs a lot less these days.  Increasingly we use smart mobile devices to get out work done - eschewing even the laptop - much less the desktop machine.  Increasingly we are happy with PDF files and HTML text - not needing elaborate Excel Spreadsheets, or Word documents or flashy Powerpoint files.

Meanwhile Apple is a major participant in the new markets being developed!  It's iPhone is a leader in smartphones, where its mere 5% market share has allowed the company to sell 2 billion downloaded applications in the first 18 months!  And although digital music is becoming the norm as CDs disappear, iTunes maintains a very healthy 70% market share of digital music downloads.  And Apple is moving forward into digital publishing with the iPad launch, as well as hundreds of new applications for low-cost but highly functional tablets (a market Microsoft pioneered but exited.)

Many people invest by looking in the rear view mirror.  But Microsoft increasingly looks like a "has been" story.  Looking out the windshield, it's hard to place Microsoft on the future horizon.  Give the Forbes article a read and let me know what you think!