Microsoft still top of heap, but unlikely to be as
First published in Business in
Vancouver The high-tech office column, Issue #612, July 17,
by ALAN ZISMAN (c)
The news was good for Microsoft this
week (as I write):
a U.S. appeals court had thrown out much of Judge Jackson's
judgment against the company, including his recommendation that the
giant be split up.
While Microsoft has cause to celebrate, I suspect that
the company will
never have it as good as it did in the last half of the 1990s. And this
is regardless of the ultimate outcome of its battle with the U.S.
Department and other legal adversaries.
During that period from 1995 to 2000, Microsoft had
to define the direction of technology. The Windows 95 operating system
and its successors ruled the desktop, relegating Apple's
to a few modest niche markets, despite its continued elegance and ease
Microsoft's Office owned the market for business
with once-fabled competitors such as Word Perfect and Lotus
1-2-3 hanging in with single-digit market shares.
Microsoft's power was such that it was perceived to
have "saved" Apple
by deigning to continue to develop Office for the Macintosh.
Admittedly late to catch on to the appeal of the
came from behind, rapidly demolishing Netscape's 80-per-cent
of the Web browser market.
While still facing competition, Microsoft was a major
player in markets
for network operating systems, enterprise databases, even games. Other
technology companies seemed to vacillate between fearing that Microsoft
would compete with them and hope that the company would choose to buy
But even after winning in the courts, Microsoft faces
in these next five years. While the company remains a giant, it may not
be the 800-pound gorilla for much longer.
Part of it is consumer ennui, combined with a soft
market. While neither
Windows nor Office is perfect, users are less excited about upgrading
new releases. Microsoft will still be able to boast about large numbers
of people using new versions of these products, but the bulk of these
will be getting them pre-installed on new computers, which brings in
revenue. As a result, Microsoft is flailing away in all directions,
for a new business model. Perhaps software rentals. Perhaps providing
online. Or maybe it's time to crack down harder on software piracy.
(Some evidence: in an effort to push users to upgrade
to newer versions,
Microsoft has dropped support for Windows 95 and has announced that it
will be dropping support for Windows 98. As well, it has said it will
spending US$500 million dollars to promote this October's Windows XP
Get ready for the hype!)
While the open source Linux operating system has not
on many desktop computers, its share of the network server market is
faster than Microsoft's products. The result is a shrill attack by
representatives on the General Public License used by many open source
developers. Ironically, Microsoft itself has been using open source
in its own software and to run its Web services.
Last year, Microsoft announced that they were "betting
on a vision called .Net ("dot Net"), an ambitious-sounding future where
Microsoft will be a behind-the-scenes provider of online services to
ranging from home users to large enterprises.
If I sound vague, it's because I am. It's not clear to
me how or when
.Net will evolve.
Despite the lack of clarity, there seems to be a
of Microsoft's plans. Perhaps it's the result of too much downtime on
Hotmail e-mail service. Or security holes in Outlook.
Regardless, few seem anxious to "bet their companies"