Microsoft - another big yawn
Monday, June 19th, 2006
Microsoft developing iPod Killer, Microsoft brings internet to a halt with Vista, Microsoft … well it’s a yawn.
It seems that Microsoft has finally morphed into the worlds most boring company, as an investment we mean, of course as a technology company it’s becoming a bigger yawn ! So what can be done and what’s going on?
Well Microsoft’s stock has pretty much stayed where it has been for the last four years, not producing any really exciting returns over that period. In fact, it was only wehen Bill Gates announced he was going to leave (eventually after two more years) that the stock picked up a little. Yes, this is the same Bill Gates, the co-founder and richest man in the world we’re talking about, yes Bill Gates leaves and the stock price goes up.
What’s the problem, well since the beginning it could be argued that Microsoft hasn’t really invented anything - generally it’s bought (or forced) it’s way into a market and sat on the market until sheer size and inertia get’s it where it wants to be. Though this worked well in the past from the DOS program that started the ball rolling, through to MSN (where Microsoft is yet to show a return for it’s reported billions invested) let us not forget the WebTV, Pen Windows and missing the whole internet thing.
Over time Microsoft has managed to become a huge player in almost every element of our lives. In fact that’s been it’s main problem, how to grow and sustain growth at the phenominal rate of the past. It seems that in this area Microsoft is a spent force.
So will a new management team surface over the next few months that is able to cope with the challenges or will the loss of it’s original leaders give waste to the great opportunity? Well we won’t have to wait too long, in the next few months we’ll start to see the roll out hype of the much awaited, much diluted and much delayed MS Windows Vista - the way in which Microsoft conducts itself with this product will be the swan song for Gates and possibley the poison chalice for the new leadership team. How they seize the opportunities will very much determine the value of this company as it moves forward. Let’s not forget that the IT industry will be a very different place then (google etc) and that it’s an industry that takes no prisoners (Cray, SGI, Sun).
So, are you better off putting your cash under the mattress than keeping it in Microsoft at the moment - we’re bears on this one.
As a postscript we noticed that microsoft blogger, Robert Scoble, got bigger headlines than Bill Gate’s leaving - wonder who’ll have the biggest leaving party! Yawn ….