Microsoft's bad dream boogie
Published: 21 Sep 2005 14:40 BST
With the ink barely dry on the Dell-Google agreement, a range of PCs aimed at the consumer and small business is already shipping. With the stripped down GoogleBox OS and Google Access triple-play broadband, the computers "cost less than a Windows licence" as Michael Dell noted at the launch. Google is heavily discounting the hardware, confident that it can see a profit from software services much as mobile phone companies used to do from voice calls. "No viruses, no patches, no lock-in, no Microsoft tax," said Sergey Brin, "just everything you ever wanted your computer, phone and TV to do, but better." When asked why people couldn't buy the cheap hardware and then reformat them as Windows computers, Dell said. "We're not stopping them. But why would they?"
ZDNet UK News 21/10/2006
Nightmares like that keep Microsoft awake. These bad dreams are behind the latest reshuffle, which clearly defines the order of battle Microsoft expects over the next few years. Application software is in with online services, operating systems are in with development tools, entertainment and gizmos are out on their own where the tap can be turned off if those billion-dollar gambles don't come good.
Curiously, the new company structure looks like that suggested as a remedy at the time of the first big antitrust cases. Then, Microsoft's cosy codependence between OS and applications was cited as an illegal tool of market manipulation: now, it's poisonous to the company itself. Yet the company can't quite bring itself to take all the medicine.
Microsoft rightly sees its future revenues segueing from OS and shrink-wrapped applications to smart client and hosted services, but it has yet to prove that it's making the change for the right reasons. Ideally, it would be doing this to offer better security, lower prices and more flexibility to its customers, not switching because it's wrung every last penny out of the old ideas while the barbarians are already at the gate. We know why Microsoft says its changing: now we have to see what it actually does.
Reorganisation alone is not sufficient to avert the nightmare. If Microsoft uses the remains of its monopoly to try and enforce its own standards on its hosted software, it will cede capability, credibility and cost to the open world — a world with dreams of its own and, increasingly, the will to carry them out.
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