Microsoft: A High Tech Dinosaur
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The early retirement of CEO Steve Ballmer is an acknowledgement that Microsoft is no longer on the cutting edge
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Steve Ballmer, who succeeded Microsoft co-founder Bill Gates as chief executive of the company, will retire within the next 12 months, the software giant said today. It would be nice to think that Mr. Ballmer is leaving a company on top of its game and just wants to “spend more time with the family” but for those of us who have suffered Microsoft products for the last 10 years, the obvious reason is he’s leaving an old ship with plenty of leaks.
Microsoft was founded by Bill Gates and Paul Allen in 1975. It has grown to become the world’s largest software maker in terms of revenues. But as Microsoft and its consumers have learned, revenues do not mean a top-of-the-line product. Windows Vista and Windows 8 operating systems have been troubled software by Microsoft’s own admission. This user’s experience indicates that Windows 8 is merely a feeble attempt to piggyback on touchpad technology, which is not what a desktop (to the extent they exist) or laptop user is necessarily looking for.
Microsoft is a long way from the mid-1970s when it was leading in computer technology
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And then there is the endless hawking of their software. Many laptops and desktops are sold with the latest version of MS-Office but good luck trying to do anything with them as you almost immediately must pony up a license fee to even save a document. And these latest trial versions override by default any prior versions of MS-Office that may be on the computer. To say these versions are mere re-hashes of prior software is an understatement. Even if Mssr. Ballmer does not want to admit it, a spreadsheet and word-processing document will virtually have the same attributes until the end of computing time.
In short, Microsoft has become an ossified dinosaur in the tech industry. If Microsoft were a government agency or even an auto company, calcification of its business model would not matter. But perhaps more than any other line of business, in the tech industry if your business model is not tomorrow, it is last decade and it’s a matter of time before extinction becomes a reality.
Microsoft is not going anywhere overnight, but then again, neither did AT&T nor the Baby Bells in the early 1980s when Ma Bell was broken up by the government. In time, though, they lost their monopolies and market share to competitors who provided better products, just like Microsoft has been facing. Through acquisitions of other companies like Skype Technologies, Microsoft will no doubt be around for a while but as ITT and AT&T can attest, trying to manage an unwieldy behemoth like Microsoft does not always maximize shareholder value. Ultimately, a breakup of Microsoft into rational business units will be the best thing for shareholders, consumers and technology in general. Such will allow the unprofitable and underperforming business units to face their reckoning and not be subsidized by profitable products as often happens with diversified companies with large revenue-stream portfolios.
Mssrs. Gates, Ballmer and Allen rode to the top of the tech world practicing capitalizing on cutting edge technology and survival of the fittest. Now Mr. Ballmer is experiencing that phenomena again, but on the opposite end of the spectrum and not in the way he is used to. He realized it was time to dismount the technology dinosaur.
-I.M. Windee
