Re:Microsoft to Cut Jobs, Take $7.6B Nokia Writedown
by thaumasiotes on Thursday July 09, 2015 @01:56PM
(#9859559)
> network effects (speaking in a business sense) were far weaker due to the fact that PCs weren't able to communicate
But Excel's huge win was developing the ability to save a spreadsheet in Lotus format so your coworkers could open it.
Re:Microsoft to Cut Jobs, Take $7.6B Nokia Writedown
by exelius on Friday July 10, 2015 @11:30AM
(#9864477)
Yeah, I'm not saying network effects were non-existent... but it's hard to change your document format and lock your competitors out if every software update has to be shipped physically on a floppy disk. The world is different now; platform network effects are much stronger because the platforms can adapt themselves on the fly to competitive pressures.
Also, Microsoft was a very different company in the 80s. They were a scrappy startup that had to prove themselves, and didn't have any legacy products, cost structures or business models dragging them down.
I'm not saying it's impossible for a company to be successful in the smartphone space as a solid #3, just that it's a bad idea for Microsoft to try to be that company. It's too far from their core competencies, and it clouds the strategy for their cash cow products.
IMO the majority of the value of Microsoft as a company at this point is their enterprise sales network. The relationships they have there are essentially a machine that lets them print money year after year. Consumer electronics (like cell phones) don't let them take advantage of their most valuable asset.
Instead of trying to chip away market share from Apple and Google, Microsoft should be going for the jugular against IBM and Oracle in the enterprise space by getting Microsoft enterprise applications on every phone, tablet and browser they can. Because that's the part of the company that makes money, and what they've done over the last 10 years is essentially try to leverage their high-margin enterprise software business to create a low-margin consumer electronics division. It's insane, and while I understand the need for products like Surface to create a baseline for quality with their OEM partners, it also doesn't make sense to sacrifice your profitable businesses to try to make those other products a success.