I well remember reading Peter Gutmann's "Cost Analysis of Windows Vista Content Protection" [1], in which he said:
"The Vista Content Protection specification could very well constitute the longest suicide note in history."
I'd say Peter's prediction is holding up pretty well so far. I mean, Microsoft is not dead, and they're not even near death, but they do look more like an invalid than an industry leader.
I think it's a combination of Vista and XBox 360. When Windows 95 came out it used both game support and office applications to become the defacto standard in businesses and homes. XP brought solid compatibility and durability. Vista became Windows ME part deux. There's no need to buy a new computer when the 360 has shifted the hardcore gamers away from the PC. And although Office 2007 is the first significant improvement in 10 years, the fact that you don't need Vista to use it detracts from any tie in possibilities. Now throw on top of this the estimated 33% failure rate of XBox 360s and there isn't much to brag and toot their horn about.
Amazingly successful? Perhaps for the game companies but not for Microsoft. It hasn't turned a profit since it was released 7 years ago (although there is some speculation that it might turn one this year).
To be fair, the last I read they turned a marginal profit on the 360 (earnings report from the EDD divsion) in January, but that isn't what gives them a $260 billion market cap. Compared to the profitability Nintendo has raked in through the Wii and DS it's anemic.
You're comparing fundamentally very different approaches to the game console industry. Nintendo must be profitable selling its consoles and software licenses in order to survive. The company ethos is letting people have fun and doing so in the most economically efficient way possible. Microsoft cares more about getting their hardware and software into America's homes. They don't want profit, they want a platform for content delivery.
I realize they're going about it in different ways. The focus was on the damage to the brand. As a brand, when people think Microsoft products they generally think "hold back and wait for the first service pack, the hardware refresh, or the 3rd product iteration".
That's expensive when you rush something to market and the market doesn't bite because the product was rushed and the brand suffers. Under the Microsoft model that works because they have the cash reserves to burn through the flops and deadpans, but it damages the brand each time.
In contrast, when people think Apple, Nintendo, Adobe, Google they tend to associate those brands with strong cost/value.
The Xbox is one of the few products that actually break the Microsoft trend. The first one was great and the second one was better as far as value provided to the consumer goes. Manufacturing problems make me suspect Microsoft hasn't figured out this whole hardware production thing (and they haven't), but the brand itself would only be tarnished if the Xbox 360 were fundamentally broken rather that just failing more often than the industry average. Hence why I claimed the Xbox 360 is not really comparable to Vista.
I can agree with that, both as a consumer and a developer. Of the 3 consoles Xbox is the easiest/cheapest to develop for and the value of Xbox Live is certainly not to be overlooked.
I think I'm not alone in witnessing Microsoft and the BSA treat my corporate customers very badly over the years. The biggest deal at my biggest corporate customer's IT dept. is the "renegotiation" that happens every couple of years with MS in which they send their people in and see how much more they can grab this time around...
When you treat your customers like crap, they don't line you. Now there's a surprise.
I think after all I've seen, when the decision finally falls to me, I'm gonna be Ernie Ball'n it, even if it costs more up front.
These guys will mint for as long as corporate America uses office (probably 10+ years) and mom & pop in Peoria buy PC's from Best Buy (probably 10+ years). Will they ever be front and center again? No. But give them credit. From 1981 to about now they ran things. In this business, staying on top for 20 years is unheard of. And they will still be around, at near current revenue levels, for at least 10 more.
Name 1 tech company today that you think has a chance of matching their track record.
I find this interesting, mainly because personally I'm less hostile towards the company than I was 4-5 years ago. I think that overall, the "evilness" of MS has abated somewhat, and I no longer feel it necessary to scrutinize every action they take to see how it might be screwing over the customer.
I wonder how much of the decline is based on the entertainment side of MS, such as their push of the Xbox platform. Perhaps the business-types see this as MS losing focus from what they care about, software solutions for their companies.
Could it be because MS' relevance has reduced drastically in a lot of places? Its monopoly is going away, slowly but surely. Office is still a killer, but indications are that we will get other powerful choices - one sunny day. (In fact, most light document editing is easily accomplished by Google Docs.)
This is more of a fluff piece for some market research firm than a story/article.
However, I do agree that their brand could be much stronger. Relatively few people know what the Zune is - tons of intelligent (often iPod-using) people have no idea that Microsoft has a music device. When they think Microsoft, they think Windows, Office, Internet Explorer, and Xbox.
I find I'm less hostile to MS now (note that I didn't use M$, like I used to), because unlike many I feel that vista was a great security update (My family that uses vista has not complained of adware or viruses since), while I use linux.
However I must note, even as a person hostile to mac, I live in awe of the might of Steve Jobs and his influence on the masses.
"Look, its a thin laptop computer that sony made long ago but I decided to push!"
"Look its a phone, but not just any phone, it is an iPhone! You must buy it!"
"Look its a decently constructed but sorely overpriced piece of common technology that I decided to work on a little and brand with my company name! You must buy it!"
"The Vista Content Protection specification could very well constitute the longest suicide note in history."
I'd say Peter's prediction is holding up pretty well so far. I mean, Microsoft is not dead, and they're not even near death, but they do look more like an invalid than an industry leader.
[1] http://www.cs.auckland.ac.nz/~pgut001/pubs/vista_cost.html