The cash carrier crisis

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In Search of a New Cash Cow and Common Carrier

--Schestowitz 04:55, 30 January 2011 (UTC)

In Search of a New Cash Cow and Common Carrier

Summary: As Windows figures sink like a rock (despite cheating) Microsoft must find new lock-in method such as SharePoint

<a name="top">E</a>ARLIER today we showed that Microsoft [cref 45151 possibly fakes its financial results again]. Putting that all aside, Business Insider <a href="http://www.businessinsider.com/chart-of-the-day-microsoft-online-operating-income-2011-1" title="CHART OF THE DAY: Microsoft Incinerates ANOTHER $543 Million Online">reports</a> that Microsoft still loses over $2 billion each year in the online business alone:

Every quarter Microsoft reports earnings, and every quarter it reports a massive loss in its online operations. Today it reported a $543 million loss for its December quarter.

When Microsoft reported the numbers (they had been leaked beforehand because the site got hacked) the <a href="http://www.reuters.com/article/2011/01/28/microsoft-research-idUSSGE70R08D20110128" title="Microsoft shares fall on Windows, PC weakness">stock responded negatively</a> and sank to the lowest level in almost 2 months. It turns out that, given the demise of Windows, it is reasonable to believe that other products which depend on Windows as a common carriers (e.g. Office, SharePoint) are bound to suffer to and speaking of <a href="http://techrights.org/wiki/index.php/SharePoint_Reality_Log" title="SharePoint Reality Log">SharePoint</a>, there is <a href="http://www.realstorygroup.com/Blog/2081-The-high-cost-of-Microsoft-SharePoint" title="The high cost of Microsoft SharePoint">criticism of the cost of this pile of uninvited lock-in</a>.

Microsoft estimates that you the customer will spend a total of $6.2 Billion on services related to SharePoint in 2011 (see their partner pitch). According to my rough estimate, you can add $1.7 Billion in 2011 SharePoint license revenue on top. This for a product that many sales folk continue to tout as low cost, and sometimes even as free. That's a huge amount of money by anyone's lights, and so it's no wonder SharePoint has been subject to so much hype. To get a feel for just how much money we're talking about here, I assembled the chart below. According to Goldman Sachs data more than 50 countries have a GDP (Gross Domestic Product) less than what the world spends on SharePoint.

Microsoft has devised all sorts of new lock-ins, but unless enough business swallow the bait, this is not a viable long-term strategy. <a href="#top">█</a>

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