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Thread: Will Microsoft become the General Motors of software?

  1. #1
    HappyAndyK's Avatar
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    Default Will Microsoft become the General Motors of software?

    Microsoft’s position seems to mirror General Motors’ position in the auto industry a few decades ago. Like Microsoft (MSFT) today, GM was an icon in its industry, held a quasi-monopoly, produced eye-popping profits and was often distracted by antitrust lawsuits. When a company experiences this kind of environment over a couple of decades, it eventually loses its competitiveness. Of course, Microsoft would vigorously deny any such comparison. The top executives in Redmond, Wash., claim to be on top of the trends in the industry. They are confident they can develop all the software they will need to be competitive.
    Will Microsoft become the General Motors of software? - Fortune Brainstorm Tech

    So, will Microsoft become the General Motors of software? What do you think?


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    estra is offline Windows Enthusiast
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    Microsoft seems to be a flexible company that does respond and adapt its business according to changing world and its challenges. So I'd say, it will not fall on its face and will continue to prosper.

    It is probably Apple (I know it is not that big and cannot be called "GM", but still...) with its rigid politics and practices that might become the next GM.

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    seti is offline Member
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    I had read similar to this some time ago. I compare MS to Ford not GM. Why because as Ford (some say) started the trend for mass production, they became the trend setters by giving people what they wanted. Who can forget the Zephyer and Zodiac for example (if you live in the uk and were a boy of the 1960's you'll know what I mean). When Ford couldn't make what the market wanted they went and brought those who did. MS are very much going down that route, and long may they continue. As for Apple, well I personally think they will be an interesting foot note in history in the pc world, but could still make it in the gadet world.

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    RickyF is offline New Member
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    Microsoft is more likely to morph into an IBM-like clone then to go the way of GM. But Microsoft's days of dominance are waning as it loses substantial market share in the browser application space, in the mobile phone space, and to a much lesser degree in the personal computer operating system space.

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    seti is offline Member
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    Quote Originally Posted by RickyF View Post
    Microsoft is more likely to morph into an IBM-like clone then to go the way of GM. But Microsoft's days of dominance are waning as it loses substantial market share in the browser application space, in the mobile phone space, and to a much lesser degree in the personal computer operating system space.
    Sorry did not quite understand the comment about MS loosing substanial market share in the browser application space. IE still dominates the browsers by a considerable way, Bing is almost 10% of the Search and growing monthly. MS has increased OS share not shown a decrease, so I do not really see the logic in what you said about it morphing into an IBM Clone. I am not being funny but your arguement just did not make sense given the facts as they presently stand.

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    I worked in the US automotive industry for 25 years and I see some major differences between GM and MS.

    1. During any economic downturn the US auto industry shuts down or delays almost all new product development (can you say mistake). MS released their best OS to date during the worst economic crisis the world has seen in a very long time.

    2. During its glory days the US auto industry agreed to some ridiculous union contracts that included things like the "Job Bank" which guaranteed a laid off auto worker 95% of their pay and benefits indefinably until they were "redeployed". Many union members benefited from this for over 10 years until it was negotiated out of the contract in 2006. I do not think MS is saddled with an issue like this.

    3. The employee turnover rate in the US auto industry was the lowest in the world because of major union pay & benefits and out of this world retirement benefits. In 1999 GM had something like 128,000 hourly workers and 450,000 retirees making almost as much in pay and benefits as the hourly workers. The car companies call this a "legacy issue". I do not envision MS having to deal with legacy issues like this.

    4. MS appears to be a well managed company from a financial perspective. In the worst economy the world has seen in a very long time they have doubled their long term debt but they still have a very strong balance sheet and are introducing some great new product. The US auto industry has returned from the dead at least three times in the past 25 years, weaker and smaller each time. I do not see a parallel here.

    Just my 2 cents worth. Take for what it is. I have strong opinions on the subject.
    Last edited by roraniel; 18th November 2009 at 15:02.

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    1. During any economic downturn the US auto industry shuts down or delays almost all new product development (can you say mistake). MS released their best OS to date during the worst economic crisis the world has seen in a very long time.
    Absolutely right sir.

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    If you go back in history you will see that most very big companies (that were very big at one time) have rotted from within. When they are that big, they have a tendency to be busy with themselves. If you cut their outside phone lines, they will not even notice it for years.

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