Post: #1

I am not a computer guy by any stretch, but they had a really, bad earnings report this week.

PC sales are going into the toilet, their tablets suck, and their phones never really caught on.

Can Microsoft be on the way out? I think they are at least going to downsize in the near future.

Post: #2

Microsoft is not in big trouble. They may not be able to post the big earnings they used to and many of their products you listed aren't doing well. But they will always be in the game because of windows. Almost all business still use windows and their market share for all the different windows is still close to 90%. And I don't see that changing.

They are just fine, it's just that they may not be able to consistently grow as much as Wall Street would like.

Post: #3

No.

http://www.netmarketshare.com/operating-...pcustomd=0

Post: #4

Like I said, I'm not a computer expert, but can't you run basic laptops with just a browser like chrome? Or a tablet?

I thought windows cash cow was PC's, and PC sales are dropping as people browse on mobile, tablets, etc...

Post: #5

Interesting article from businessinsider.com

http://www.businessinsider.com/windows-m...yed-2013-7

Post: #6

Concerning but far from 'big trouble'.
Also, Windows Phone has grown faster than any other mobile OS in the last year.

Post: #7

I'm assuming if they are still extremely profitable they will just have to downsize to protect the stock price...Guy's at work keep telling me Ballmer has to go.

Post: #8

Tablets are yuppie toys and a fad that will die out quickly, and while it's true that plenty more people are using smartphones these days, a smartphone is hardly a replacement for most of what a PC does.

Microsoft primarily makes money licensing Windows to OEM's and businesses, and selling support and add on software.
Even if PC sales are slowing, there's over a billion machines running Windows and they won't be going anywhere any time soon.

Post: #9

Microsoft is massive. They're not going anywhere.

Post: #10

If they can shift towards doing more business solutions/consulting they will be fine. IBM did this and has been enjoying success for many many years now. Yes in consumer goods they are getting their ass kicked, but Apple whom they complete with doesn't look good long term either.

Post: #11

M$ won't go away, but if you're looking for safewty in investing software is not the place in general. Try McDonalds or Procter and Gamble. No one is going to make eating go out of style.

When I was in Ukraine, both MCD in Lviv were always packed. And the only dishwashing detergent most places carried was called "Fairy."

Made by Proctor and Gamble. See, it would have taken you four years to get the stock value back after the 2008 crash. But what most people don't think about is that they never reduced dividends, they kept INCREASING dividends, so your income (or new shares bought if you reinvested dividends) would have kept increasing. It's great if you don't need to sell your stock.

IN 2008 they were paying 0.35 per share per quarter. Now they're paying 0.6015 per share. Your income would have almost doubled.

The income is only 3% or something. But if you have big bucks, you can just dump in these "forever" stocks and more or less forget it.

Post: #12

(07-20-2013 04:30 PM)TheCaptainPower Wrote:  Interesting article from businessinsider.com

http://www.businessinsider.com/windows-m...yed-2013-7

Fuck me, people still listen to Henry Blodget?? The only positive thing you can say about this guy is that he wasn't pumping and dumping -- he himself took a bath on the same stocks he recommended. Oh yeah, and he's banned from the securities industry. I guess writing about MSFT is okay.

Post: #13

(07-20-2013 04:05 PM)TheSlayer Wrote:  Microsoft is not in big trouble. They may not be able to post the big earnings they used to and many of their products you listed aren't doing well. But they will always be in the game because of windows. Almost all business still use windows and their market share for all the different windows is still close to 90%. And I don't see that changing.

They are just fine, it's just that they may not be able to consistently grow as much as Wall Street would like.

It makes sense to remember that Windows only 15% of MSFT's value. Friday's drop basically discounted the entire value of the Windows business.

MSFT #1 cash cow is Office, which grew at 2% if you back out the delayed revenue recognition due to upgrade offers for Office 2013 (if you don't do this, Office revenue grew 14%). Office 365 now has over one million subscribers and $1.5 billion annual revenue run rate. In the future, the subscription model is expected to smooth out the office division's revenue stream.

MSFT's #2 cash cow is servers with 20% of revenue, with a nice 8% growth. Azure cloud sales are now over $1 billion, and has added 25% additional enterprise customers in the last quarter. Their database software apparently grew 16%!!! I have no idea how good their SQL server product is, or why someone would pay instead of using free open-source software, but people are apparently willing to pay.

The rest of Microsoft has the Windows division, online services (Bing et al) and the entertainment division. Someone mentioned that Windows Phone grew a lot - yeah, their revenue... but a pretty major portion of that revenue is patent licensing fees collected from Android phone makers. MSFT makes more money from Android than Google!

So no, MSFT isn't going anywhere.

*disclosure* -- I'm very long MSFT.

Post: #14

(07-20-2013 06:35 PM)pozdnyshev Wrote:  [....


Their database software apparently grew 16%!!! I have no idea how good their SQL server product is, or why someone would pay instead of using free open-source software, but people are apparently willing to pay.

....

Why not open source? Probably because there's someone responsible to call when it crashes, and they've got immense investment in an existing system.

I will say 15 years ago when I was programming, MS SQL server was respected even among people who hated M$ ( me included) , it was something they did right.

The migration complexity for a large operation to a new database server can lead to gargantuan difficulties. I.e, to go to another database server for let's say Hertz rent a car, a system that is operating 24/7.

You could draw comparisons to IBM in the 1980s, they dominated everything, and had to shrink, but they kept going , I don't know what kind of losses people took if any.

Post: #15

(07-20-2013 04:35 PM)Ziltoid Wrote:  Tablets are yuppie toys and a fad that will die out quickly,

Um, no

Post: #16

Microsoft is already in trouble in the sense that they are not able to call all the shots any more the way they were able to in the 1990s. When Microsoft told Netscape to do things exactly Microsoft's way or go out of business, Netscape tried to resist, and is out of business today as a result.

Today, Microsoft can not kill Google with Bing the way they killed Netscape Navigator with Internet Explorer; They can not kill iPhones and Android Phones with Windows Phones they way they killed Word Perfect with Microsoft Word.

In terms of back room servers, I do not see any growth for Microsoft there because they can not undersell Linux. Linux and Open Source have made it impossible for Microsoft to kill UNIX the way they killed a lot of other technologies; indeed, Netscape open-sourced their product before being bulldozed by Internet Explorer, and that's why we have Firefox today.

Sure, Windows and Office will be around for a long time, but it is no longer a growth market. Microsoft is going the way of IBM: Still around but catering more to specialized markets and no longer cutting edge, or, in Wall Street parlance, no longer a "growth market".

Post: #17

I'm in corporate America. As long as there isn't a good replacement for MS Office, M$ will stay in business.

None of the options available do what MS Office does, and because we're so used to MS, and it's what everyone else use, we don't want to use anything else.

WIA

Post: #18

(07-20-2013 11:32 PM)WestIndianArchie Wrote:  I'm in corporate America. As long as there isn't a good replacement for MS Office, M$ will stay in business.

None of the options available do what MS Office does, and because we're so used to MS, and it's what everyone else use, we don't want to use anything else.

WIA

Why are companies like Google and Apple so indifferent to resisting the dominance of MS Office? That's the big mystery to me. Apple in particular has made it clear that they're a consumer rather than business to business based company. Why can't they be both?

And Google too has shown a flippant attitude. Google Docs is still surprisingly rudimentary. How come? Google can invest in self-driving cars but they can't make a superior alternative to Office?

Post: #19

You guys still use office? I thought all the cool kids had switched to OpenOffice.

Post: #20

I think most people really don't realize how much corporate America resists change and prefers conformity. MS makes money on both of these factors since they sell them the support and everyone already uses their stuff already. Most of my firm's retail banking clients (not IB, trading or other sexy parts) are using Office 2003 since they're cheap as fuck and everyone uses it. And as long as MS maintains support, they won't update until support is dropped.

Corporate America essentially likes the ability to call someone up and yell at them for why something isn't working. This has been one of the biggest reasons open source options don't do well until someone can sell them the support service. Linux had a hard time taking off until Red Hat offered support and the same thing with the Hadoop severs lately.

While MS is not as sexy anymore, particularly in the consumer space, their B2B stuff is still doing decent for the most part.

Post: #21

Backwards compatibility is a huge problem in companies. Old production machines running on Windows 95/98/2000 for example. No support for the software is a killer argument. As a company, I want a functioning and easy to use system for the average non expert-user. Microsoft will stay a long time in the business market.
Change and Software-Upgrades cost money and very often the system will not work after the transition or be any faster/better.

Post: #22

Quote:Tablets are yuppie toys and a fad that will die out quickly

You sure about that? Foreigners are taking to it wholesale because of the status it displays.

Post: #23

(07-21-2013 08:39 AM)Roosh Wrote:  

Quote:Tablets are yuppie toys and a fad that will die out quickly

You sure about that? Foreigners are taking to it wholesale because of the status it displays.

Yeah, I think tablets will be around for a while. It's not just status, they're a pretty good business tool for content consumption. All the execs at my company ($4.5 billion market cap chemical company) use them as their primary computer. The lackeys who create their presentations and spreadsheets still need to use desktops and laptops but the consumers of the content (execs, customers, etc.) prefer the tablet form.

Post: #24

No they're doing fine.

Their a "solutions company" now where you go in, tell them what you're going to be doing, they draw up the bulk licensing, and bam enterprise goodness dropped in everything.

Macs and linux are ok, but i'd rather deal with exchange.

Post: #25

(07-21-2013 08:39 AM)Roosh Wrote:  

Quote:Tablets are yuppie toys and a fad that will die out quickly

You sure about that? Foreigners are taking to it wholesale because of the status it displays.

Well, to my mind that is exactly why they are a fad that will die out. At roughly the same price as a normal laptop/netbook for 1% of the usefulness, it's a hard purchase to justify for any reason besides having a cute gadget to mill around on and impress people with... Status, as you said. But how long can that market sustain itself really? They're not really expensive enough to demonstrate status beyond the novelty of them, and if they're here to stay eventually every teenage girl and retired grandpa will be carrying one around thus destroying the novelty factor.
Especially with way cooler (and arguably more useful) things like Google Glass and non-invasive BCIs just around the corner, I just don't see them lasting.

I'll eat my words if they do.