Apple Prepared To Pass Microsoft As Second Most Valuable US Company

[famousringo]

Squilliam said:

famousringo said:

Silver-Tiger said:

What? So you consider the Xbox brand a failure? Last time I checked, Xbox 360 was second in the console race and sold nearly 40 million units.

Look at it from an investor's standpoint. Microsoft has burned piles of cash to buy second place in a market and is struggling to recoup the expenses of this generation, let alone those of last generation. That's not creating value for shareholders.

No matter how much consumers like to buy subsidized hardware and software, it's not a success from an investor perspective.

Nope its not. However the alternative was what? Sit on the money? Buy another couple of companies? So far the ROI is better than the interest they would have recieved from sitting on it and the latter option could have gone either way. I don't see them as being mad, perhaps more disapointed that they couldn't have done more/better.

Oh, I'm not suggesting that MS shouldn't go out and seek new markets. They have to, and it's clear that they're trying quite hard to do so. MS knows that companies are either growing or dying, it's just that their efforts to grow aren't meeting a lot of success.

I think Microsoft's problem is that they keep trying to take over big, established markets instead of persuing fledgling markets or creating new ones. They try to tackle search well after Google has it sewn up, mp3 players after Apple has it sewn up, consoles and Sony, et cetera. They had a pretty good position in smartphones but they let it slip out of their grasp. They keep going after companies that are big enough and entrenched enough that they can withstand Microsoft's huge size and deep pockets.

If I were Ballmer, I'd spend less time looking enviously at the markets that rivals have seized and more time looking for markets they haven't seized yet. He was sharp to identify the threat that Linux-based netbooks represented and moved quickly to crush it. He needs to use that perception in an aggressive manner and not just a defensive one.