11.01.10

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Apple and Microsoft Both Attack Linux Similarly, But the Latter Suffers From Innovator’s Dilemma

Posted in Apple, Microsoft, Patents at 7:22 am by Dr. Roy Schestowitz

George VI and Queen Elizabeth

Summary: New observations about the decline of Microsoft (which suffers from several long-living issues) and its Apple-like response, which is disregard for some free/open standards and litigation that is based on software patents

Wayne Borean has just published a couple of blog posts which he titled/preceded with “Microsoft Death Watch”. For quite some time he has been talking about the possibility that Microsoft won’t survive for a long time to come and we are now seeing such claims (or at least similar ones) qualifying to enter the mainstream/corporate press (shortly after Microsoft’s latest results which obfuscate issues). Borean’s first post claims that “The Mainstream Media Notices the Problem”:

Last year when I predicted that Microsoft had five years until they’d have to apply for Chapter 11 Bankruptcy Protection, there was a lot of laughter. I was told that I was crazy – a point that I won’t argue. Being crazy means that you see things in a different light.

And then we have Information Week running an article titled Microsoft Looking Like An End-Stage Company. In it Information Week calls out many of the same points I’ve been making. They also suggest that Steve Ballmer, the President and CEO needs to go. Soon.

Then we have CNN with an article titled Microsoft is a dying consumer brand. One of the people they quote is Ray Ozzie, who has just left Microsoft, and posted a comment in his blog.

Microsoft looks like a classic case of The Innovator’s Dilemma. When was the last time that Microsoft introduced a successful new project? I can tell you exactly. It was August 24th, 2001. The launch of Windows XP, which merged the 9x and NT versions of Windows, is the last successful new product, and it wasn’t even new. It was a merger of two pre-existing products.

[...]

My original prediction was based on Microsoft taking no action to avoid bankruptcy. Obviously Microsoft would take action, but I didn’t have any idea as to what sort of action they would attempt to take. Oh, we know that Microsoft has been selling off and closing divisions, my thanks to Dr. Roy for hosting a listing.

The problem is that selling and closing divisions doesn’t address the main problem, a lack of productive innovation. If you can’t or won’t bring new products to market, you might as well just close the company.

The follow-up titled “Microsoft Death Watch – Libre Office Drives Another Nail Into The Coffin” speaks about the main cash cow and the threat posed from an increasing number of directions (not just Free software):

Any change in sales of Microsoft Office will have a huge effect on Microsoft’s profitability, and the corporation’s ability to develop new products. Remember my prediction that Microsoft would be in Chapter 11 Bankruptcy Protection within five years? A large part of that prediction was based on the growth in market share of IWork, OpenOfficeOrg, and Google Docs, and the economic pressures on end users of the recession.

What does a company with a thousand seats (installations) of Microsoft Office do when money runs low, and it’s not possible to renew the licenses? At this point OpenOfficeOrg looks like a great deal. Sure, it’s not completely compatible with Microsoft Office, but the cost factor can’t be ignored.

Alastair Otter asks similar question with his headline, “Beginning of the end for Microsoft?”

There are a couple of moments in Microsoft’s long history that will be remembered as when the company changed forever. One of those is, naturally, when Bill Gates handed over the reins. The other will be the day that Ray Ozzie, Microsoft’s chief software architect, leaves the building.

Ozzie’s departure was very major news [1, 2]. Well, even a Microsoft booster who has been loyal to the company for a long time is willing to acknowledge this:

It’s easy to lampoon Ray Ozzie’s farewell memo to Microsoft – Dan Lyons summarised it as “We suck. I quit. Goodbye.”

Expect Ray Ozzie’s function to be replaced by the likes of Horacio Gutierrez, who is intimidating, extorting and sometimes suing companies that ‘dare’ not to use/distribute Windows and Office. Gutierrez was recently promoted, which ought to give a clue. It is no secret anymore that Microsoft is using patents as a “Plan B”, so to speak. Groklaw responds to Ray Ozzie’s unfounded claim that Microsoft “continued to grow and mature in the area of responsible competition, and the breadth and depth of our cultural shift toward genuine openness, interoperability and privacy which are now such key cornerstones of everything we do.”

“Run that by me one more time,” wrote Pamela Jones in response to this. “Genuine openness, you say? Interoperability? Is ODF allowed to be fully interoperable now? No? How can that be, if Microsoft if now genuinely open and interoperable? Yes. I jest. And with Ozzie ejecting, I’d say the future of any genuine openness is not something to expect any time soon from a company that didn’t even know how to respect a man like Ozzie.”

“…Microsoft is reportedly now using patents to block Taiwanese manufacturers from using Android in netbooks unless they pay Microsoft, which raises the price of using Android.”
      –Pamela Jones, Groklaw
Jones also referred to Microsoft’s patent extortion [1, 2, 3, 4, 5, 6, 7] of companies that may sell Android or ChromeOS in/from Asia. “If I might point it out,” wrote Jones in response to a post from Dana Blankenhorn, “what bundling did for Microsoft was get it into antitrust lawsuits, which I expect will happen again with its anticompetive patent strategy, which is how this article describes its purpose, without apparently realizing that it’s digging a hole for Microsoft while meaning to halfway admire the strategy. I’ll bet we’ll see this article in a lawsuit someday, actually. There is a point where patent law and antitrust law meet in a High-Noon kind of way.”

She wrote separately: ” Some of us don’t admire Microsoft’s business practices. For just one recent example, Microsoft is reportedly now using patents to block Taiwanese manufacturers from using Android in netbooks unless they pay Microsoft, which raises the price of using Android. I read that and it makes me want to avoid anything Microsoft offers ever. And it makes me want to try Android on a netbook, because in my logical mind, if this is all Microsoft can do to compete, it must be offering second-rate goods, I conclude. That’s how I react, and I doubt I am alone.”

“The resonable man adapts himself to the world; the unresonable on persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.”George Bernard Shaw

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