What to Make of the Microsoft-Is-Falling-And-It-Can't-Get-Up Meme
Oh dear, here it comes round again, like a bout of the flu–the indefatigable narrative about how Microsoft is headed downhill at an alarming speed, how CEO Steve Ballmer is about to get the boot and how it is all really, really true since the echo chamber of tech keeps repeating it.
Over the past two weeks, for example, I have gotten numerous “tips” that all these things are about to happen. Except when I go to check them out by doing some actual reporting, they turn out to be more chatter than reality, more barstool musing than concrete, and without much in the way of those pesky facts.
Today, we get yet another from the Olympic champion of traffic-goosing headlines on blogs, Henry Blodget of Silicon Alley Insider, in what is quite a humdinger of a title: “The Odds Are Increasing That Microsoft’s Business Will Collapse.”
Holy Guacamole! Really?
You mean the Microsoft that still–despite all the Google Apps machinations–has a hammerlock on the enterprise software market? The company with a badillion dollars in cash in the bank? The one that can lose more than $700 million in its Online Services division and not blink an eye?
Actually, the headline is the most exciting part of the whole article that follows, which hedges mightily as it also dredges up old news about Microsoft’s business challenges.
The short version: The Internet is everything that’s not good for Microsoft; Apple (AAPL) is rocking the mobile market; Google (GOOG) is disrupting all over the place; and, natch, the oncoming cloud-computing incursion is worse than the Smoke Monster from “Lost” for Microsoft’s cash-generating Windows and Office businesses.
All true in a very broad-brush way. But, of course, Blodget pulls a complete on-one-hand-on-the-other at the end, although he cannot resist a final over-the-top statement:
Right now, the investors are concluding that Microsoft will gradually become the equivalent of a technology utility–a boring but necessary provider of the software that runs the world’s business community. A smaller, more optimistic crowd is still arguing that, one day, Microsoft will be able to turn its fortunes around, and fight its way back into an industry leadership position.
What almost no one is talking about is a third possibility, one that becomes more likely by the day: The possibility that, a couple of years down the road, Microsoft’s business may just completely collapse.
Here’s the simple and less flashy situation:
Microsoft, as all tech companies do, needs to change, and a lot faster than it has so far; the company has been trying mightily to do so in search and recently, in mobile, where it is woefully far behind; its leadership under Ballmer, who took over from co-founder Bill Gates, has been meh enough to keep its stock moribund.
But, by no means recently–even if there is a better CEO for Microsoft out there than Ballmer–have I found the company execs ignorant about the tougher issues or unwilling to consider changes needed.
In fact, in its high-flying days, Microsoft did have a tin ear to criticism. No longer, and I would call its execs appropriately concerned about fixing its issues, although their efforts do suffer from the company’s massive size and inertia in making the right moves.
Thus, they certainly might not be successful at innovating, although these are the very kinds of problems Apple CEO Steve Jobs solved when he returned to a rotten company in what, in its current glory days, seems eons ago.
And Microsoft has been getting the same questions that are beginning to be asked about Google.
But can you imagine anyone not mocking a likely headline-to-come about the search giant: “Search: If That’s All There Is, My Friend, Then Let’s Keep Surfing (to Oblivion!)”?
That’s why–at this point–I can see no need for panic to set in about Microsoft. Next year, perhaps. Five years, with no change and not listening to the obvious, definitely.
As for today, even though we are all terminal, the sky looks like it will remain intact at Microsoft for a little bit longer.