Monday, February 15, 2010


Can't remember where I read it, but a former MSFT insider wrote recently that a simple way to judge the kind of company that Microsoft is and what kind of company its competitors are is to look at how old its revenue streams are.  For example, Microsoft makes essentially all of its profits from Windows and Office, a line of products that are, conservatively, each 20 years old.  Hell, we're now 15 years out from Windows 95, right?

Meanwhile, Apple now makes more money from selling iPhones than it does selling computers [PDF] -- the iPhone being a grand total of 3 years old.  Even excluding the iPhone, "iPod and music services" (presumably iTunes Music Store, only 7 years old) account for more revenue than desktops and portable computers.  Result: Apple could lose the entire personal computing market and, while there'd no doubt be a few lean dinners at Cupertino, they'd actually be doing just fine.

Meanwhile, Microsoft's revenue stream rests basically on the presumption that an extortionate monopoly can be maintained in perpetuity.  What happens if tomorrow the US government announces they're shifting to OpenOffice? Just asking.


Catelli said...

MS Office is an interesting love/hate relationship for corporations. Every 3 years we grit our teeth and pay up to stay current. It is not cheap.


We're at a loss to find alternatives. I love OpenOffice, it's what I use at home and it's what I install on any computer I work on for friends/family/etc. In a larger office like ours, OpenOffice doesn't cut it (as much as I want it to). The biggest issue is Excel. We have thousands of spreadsheets with macros and programs that do not migrate to OO at all. The redevelopment costs would be a PITA to go through.

Second is integration. MS is doing a band up job developing seamless interfaces between Office and its server products (Exchange, SharePoint etc.) As much as it pains me to admit it, sticking with MS will allow us to build our own corporate "cloud" with secure, seamless access to data no matter where in the world we may be.

I'm not even sure that can be done on the OpenSource route.

Anonymous said...

One other point. The Microsoft Office division is more than the product Microsoft Office. While the product is probably a large part of the sales from that division, it is not the only product. (

What gets confusing is that the Office Servers products (Sharepoint, Communications Server, etc.) may be counted under the office division, rather than the Servers division (Windows, SQL, Exchange etc.)