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Ex-exec: Microsoft now "like IBM was in 1985"

updated 10:25 am EST, Thu December 24, 2009

MS seen slow, outpaced by Apple and Google

Microsoft has reversed positions with IBM and is no longer fast or innovative, former executive and now Google employee Don Dodge says. He views the company as "like IBM was in 1985" and ready to be passed by a nimbler company such as Apple, Facebook or Google. It still has an advantage in some areas, particularly development and software, but it now has major competitors in most areas and in some cases has been eclipsed.

"Very few companies can dominate an industry for more than 20 years," Dodge explains to the Seattle Post-Intelligencer. "It is just the natural competitive cycle."

He adds that having the company founders active and in charge is important to the company dynamic and that Microsoft has lost this with Paul Allen and more recently Bill Gates having left their daily roles. Google is helped by Larry Page and Sergey Brin still working at the company, while Steve Jobs continues to helm Apple.

Of the failures, he points most directly to Windows Mobile and says it's "obviously behind" not just the iPhone but Android as well, as both have more modern interfaces and in Android's case uses a significantly different licensing model. Windows Vista is also considered a "disappointment" but has been somewhat redeemed by Windows 7.

Dodge nonetheless predicts that Microsoft will face trouble in other areas and in 2010 is likely to lose many traditional Office customers to web-based Google technologies like Gmail and Google Apps as they decide to use the cheaper, more frequently updated web tools in place of costly offline software.



By Electronista Staff
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Comments

  1. climacs

    Forum Regular

    Joined: Sep 2001

    +19

    the only honest thing left for Ballmer

    to do, is to liquidate and distribute the proceeds to shareholders.

  1. climacs

    Forum Regular

    Joined: Sep 2001

    +15

    take that PC fanbois

    we told ya so.

    in fact, we been tellin' ya so for several years now.

  1. slapppy

    Fresh-Faced Recruit

    Joined: Mar 2008

    +19

    Innovative? ahahaha

    They haven't been innovative since they purchased QDOS which was a ripoff of CP/M. LOL

  1. kerryb

    Fresh-Faced Recruit

    Joined: Aug 2001

    +12

    ouch!

    We all knew this but to hear it from an insider stings a bit more. Microsoft has lost its fangs or has had them grounded down by legal battles with the US DOJ and the European Unions courts. It got too comfy in dominance of the desktop and server markets and bloated like a beached whale watching the waves incapable of moving forward. There is a lesson for all tech companies in the MIcrosoft story, never rest on your laurels, keep an eye on the little guy don't loose what got you to the top. Lastly keeping an eye on the market your serve, diversifying is good but pursuing products (xbox, zune, search) that are don't come natural will be a waste of money and resources.

  1. MyRightEye

    Fresh-Faced Recruit

    Joined: Apr 2008

    +9

    "beleaguered Microsoft..."

    It's just a matter of time before the word beleaguered will appear before the word Microsoft in nearly everything said about the company.

    You burnt your bridges with blackmail and deception and clever lawyers taking advantage of other lawyers that did not expect yours to be so rabid. Now you'll get your just desserts. Apple and Google are just waiting in the wings for your downfall. And finally technology will be able to surge once again.

  1. climacs

    Forum Regular

    Joined: Sep 2001

    +14

    Microsoft

    has been milking the same cash cows (Windows and Office) for 20 years. That's a pretty good run.

    However, they have proven they are completely unable to innovate. If they could, they would not keep trying to force everything into the Windows paradigm (as if "Windows" is a valuable brand anyway, it's muttered as a swear word more than anything else).

    Windows CE, Windows Mobile etc

    Microsoft stores = EXACT COPY of Apple stores but for the logo.

    Zune = epic fail

    Sidekick = epic fail (after Microsuck got their filthy hands on it)

    Microsoft smartphone, where is that one anyway? Will it ever come out?

    XBox = has carved out a significant share of the market but is years away from making back the hundreds of millions of dollars sunk into it.

    Comment buried. Show
  1. iphonerulez

    Fresh-Faced Recruit

    Joined: Nov 2008

    -11

    How is Apple ready to pass Microsoft?

    I guess they're talking about innovation and diversification but not market cap. As long as Microsoft controls 90% of the desktop and nearly 100% of the business market, I would think they'd be relatively safe from companies overtaking them in value. Apple hasn't made much headway in catching MS in company value despite all those iPhones sold in the last few years. Since Microsoft has released Windows 7, its share price has been moving up slowly but surely and creating even a bigger gap in market cap. Microsoft's market cap is almost up to $300 billion. Apple ($185 billion) has even been easily outdistanced by Google ($195 billion) in market cap and Google will likely be the company to dethrone Microsoft in size and market cap when they start selling Google phones. So why is Microsoft seen as being ready to topple when it continues to grow in overall value day by the day? Nobody seems to be giving up its mainstay Microsoft Office, either.

    This has nothing to do with my love or hate for any of these companies. I've just been following the market cap charts for the past six months and Microsoft is clearly pulling away even as Windows Mobile dies. If I'm missing something, please explain.

  1. QualleyIV

    Fresh-Faced Recruit

    Joined: Aug 2001

    +11

    re: How is Apple ready...

    @iphonerulez

    You've got a salient point, but consider this: if Microsoft controls 90% of the desktop and a huge share of the Office suite business shouldn't their market cap be something like 1.665 TRILLION (9x that of AAPL) if their business is as successful as Apple? They compete in pretty much the same areas (obviously there are some exceptions, but I think the commonality outweighs the differences). Of course, this presupposes that market cap is a fair method of valuation alone (I don't think it is). Nevertheless, I think the point remains that while MS may be bigger, given its position, it should be worth a WHOLE lot more than AAPL.

  1. lkrupp

    Junior Member

    Joined: May 2001

    +10

    Ever notice...

    how posters and analysts choose which measuring stick to use according to their personal bias when evaluating how successful a company is or isn't? Market share, market cap, innovation, customer service, profit margins, net income, brand recognition, etc? Depending on if you like or dislike the company in question you choose the measuring stick that supports your personal bias. Wintrolls like the market share, market cap measuring stick. Mactrolls like the innovation, customer service, and margin tape measure.

    The problem is there is no other company out there like Apple in the tech world. Some make hardware, some make software, some distribute content, some do one or two. Only Apple makes the whole pie, from crust to filling. So how should success really be measured anyway?

  1. The Vicar

    Junior Member

    Joined: Jul 2009

    +12

    I'd like to agree, but...

    Much though I feel the same way about Microsoft, this guy is rather obviously going to say whatever the company paying him wants to hear. Almost immediately before he left Microsoft, he was saying the exact opposite -- Microsoft was poised to destroy Google, and everything they did was new.

    And let's face it: Google doesn't precisely innovate, either. Google's products:
    1. A search engine
    2. Web-based e-mail
    3. Web-based Office/productivity suite (client-server office stuff dates from back in the days of mainframes)
    4. A Linux-derived phone OS
    5. A web browser built around Webkit
    6. A Linux-derived OS which only runs the aforementioned web browser
    7. A web-based collaboration product

    All they need to do is release a mouse and keyboard, a game console, and a really cruddy music player, and they'll actually BE Microsoft.

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