“Microsoft’s share of connected devices sales (in effect, PCs plus iOS and Android) has collapsed from over 90% in 2009 to under a quarter today,” Benedict Evans blogs.
“Just as overnight success can take a lifetime, so overnight collapse can also take a long time. There are founders creating companies today who weren’t born when people were still actually scared of big bad ‘Micro$oft’. It stopped setting the agenda 18 years ago,” Evans writes. “Though it looks like we’ve passed the tipping point, this process isn’t going to be over quickly. PC sales aren’t going to zero this year. But the replacement cycle, already at 5 years, will lengthen further and further, more and more apps will move to mobile or the cloud, and for many people the PC will end up like the printer or fax – vestigial reminders of an older way of doing things.”
Evans writes, “Microsoft may yet manage to turn Windows tablets and phones into products with meaningful market share, but it will never be dominant again. ”
Read more in the full article here.
MacDailyNews Take: For as long as it takes.
Excerpts from a BusinessWeek interview with Steve Jobs, October 12, 2004:
Steve Jobs: Apple had a monopoly on the graphical user interface for almost 10 years. That’s a long time. And how are monopolies lost? Think about it. Some very good product people invent some very good products, and the company achieves a monopoly. But after that, the product people aren’t the ones that drive the company forward anymore. It’s the marketing guys or the ones who expand the business into Latin America or whatever. Because what’s the point of focusing on making the product even better when the only company you can take business from is yourself? So a different group of people start to move up. And who usually ends up running the show? The sales guy… Then one day, the monopoly expires for whatever reason. But by then the best product people have left, or they’re no longer listened to. And so the company goes through this tumultuous time, and it either survives or it doesn’t.
BusinessWeek: Is this common in the industry?
Steve Jobs: Look at Microsoft — who’s running Microsoft?BusinessWeek: Steve Ballmer.
Steve Jobs: Right, the sales guy. Case closed.
[Thanks to MacDailyNews Reader “Jax44” for the heads up.]
Oh Balmer you bumbling idiot- Dance Monkey Boy dance into the abyss …
To paraphrase SJ, probably better we focus on the next great challenge and stop thinking of the past and MS.
Oh happy days!
Funny back in the day you guys would be arguing Apple is the BMW of computing and it does not need to dominate the industry to be relevant …
Sorry when I can live in rural Washington and actually get better than patchy DSL or have to walk 60 yards down the road to have cell phone conversion than I believe the cloud will kill my need for PC based storage. Maybe when I can seamlessly dictate to my pad device or phone I will believe it will replace my PC as my work tool, rather than just a light way to watch net flicks, read the news or books (and entertain my toddler).
MS has real problem like any company coming off a high point of Market Power – but as IBM proved you can manage that transition into a profitable company based on realistic new assumptions about what your place in the market is or can be.
I agree however its clear Ballmer was and is not the man to do that effectively…
Wow! Try to use some punctuation so that your note doesn’t have to be read and reread for meaning.
You miss the point. Apple understands that most of the time spent on computing is gathering data. That does not mean that PCs are dead. Microsoft still doesn’t get it.
I agree with Paul on this. All this chatter about everything going into the Cloud, wireless connected devices, etc, continues to ignore the dayglo elephant in the room; many, many people have no access to a fast, cheap, reliable connection to the Internet that doesn’t rely on copper wires.
A report just published here in the UK shows that 70% of the population have no 3G signal, and 20% don’t even have 2G!
How are we supposed to make use of streaming services like Rdio, if there’s virtually zero chance of getting a data connection, and then you only get 1Gb/month bundled with your contract. That 1Gb can be gone in less than a week, in my experience, having used 500Mb in a week streaming BBC radio for five and a half hours a day, for five days.
It would be laughable, if it wasn’t so tragic.
Paul, the danger with assuming that all of the world experiences technology the same way as you do in rural Washington is that all of the world doesn’t experience technology the same way as you do in rural Washington.
It’s clear from your description of your connectivity situation that a 1990s/2000s era personal computer will be relevant to you for a long time, your experience does not make an industry. The technology industry is moving on.
Trucks will always be relevant. But they don’t “drive” innovation in the automobile industry. The personal computer will always have a place (even iOS developers need Macs), but that doesn’t mean they’ll be driving the industry forward anymore.
Very few people are capable of seeing beyond their own narrow circumstances. Excellent and thoughtful reply, Jim.
Yeah, I think they should base their outlook for future PC growth on people who live in area where you can’t even get cellular signal…
Paul (and the article) are right — the PC will still be around for a long, long time. The problem, at least for Microsoft, is that Apple also makes a better PC. And the FUD isn’t working for Microsoft any more — Mac has been gaining PC market share at Microsoft’s expense for years.
Microsoft is certainly not irrelevant. They are still a powerful force and have some excellent products. Windows 7 is one of them. I am not sold on Windows 8. Balmer has no vision and is not an effective leader. Apple no longer has Steve Jobs. They do have a slew of great products and I hope they don’t blow it.
It’s not the cloud versus Microsoft. It’s that Microsoft is failing at everything new and everything consumer in its industry since around 2001.
Go back to the late 90s and it seemed like Microsoft was going to dominate *everything*. Every start up was afraid of Microsoft with a “maybe we’ll sell to Microsoft someday, but if they compete against us, we’re dead”. Now, the idea that Microsoft is going to compete against any start up is somewhat of a joke.
So, you’re in the demographic that lives in rural and less connected America? Not everybody does. The same could’ve been said about the Internet back in the day when it was taking off with broadband. It will get to you eventually while those in more populated areas will drive the economics.
The larger point here, again, not cloud versus Microsoft, is that Microsoft went from 90% of connected devices to 25% in such a short time. You’re right that companies can transition, like IBM, but not all do. Furthermore, the IBM example is exactly the point of the article. IBM was once feared and followed as being dominant in the industry. They crumbled and settled into a niche. They’re now a 200+ Billion market cap company, but they don’t dominate the overall industry at all.
Microsoft may focus and settle into a niche, and be very successful like IBM, but then again, if they keep trying and failing to do everything, they’re going to come crashing down hard.
Microsoft is irrelevant and the world is a better place.
I don’t agree that MS is irrelevant…
But MS is definitely not cutting edge or innovative in ways we consumers think of innovative. Windows merely runs another piece of equipment that is ubiquitous, but not unique or necessarily innovative as it tries to be all things to all users; a Rube Goldberg, in other words.
“… it tries to be all things to all users; a Rube Goldberg, in other words.”
You might want to look up Rube Goldberg – I don’t think it means what you think it means.
I think he meant by “all things to all users” it ends being convoluted. Too many steps to do something that should be simple.
MS made its first attempt (in recent history) at punching its way out of their “me too” template with Windows 8. They failed on almost all counts, but there was a glimmer of innovative light that somehow made it past Ballmer’s antiquated view of the world. My money says that he is already telling those responsible “Told you so!” So odds are it’ll be back to the copier business as usual. The fact that he’s now rearranging the deck chairs to try and emulate Apple’s organizational model seems to validate that.
Until Ballmer is replaced by a true visionary they have little hope of ever being relevant.
They should’ve made a better Android rather than trying to make something completely different. They still have a chance to do that… Start on a small scale and work up.
Android is about to be split into two… Samsung and Google. I’ll give Samsung until July of 2014 before they announce that they’re forking Android.
Theoretically, Samsung has to first try IRL their experiment with their own OS, Tizen, before they completely settle on Android. BUT, it is my expectation that, despite all the hype, Samsung have already found their own OS is a POS. Samsung’s creative abilities are minimal, JUST LIKE MICROSOFT. Therefore, I doubt ‘Tizen‘ will ever see the light of day. But if it does, I predict sarcasm shall rule.
Microsoft will be Microsoft. They don’t have to be better (because they can’t) and they don’t have to be relevant. They fail every time they try to act like Apple, so they shouldn’t. Ballmer is not Steve Jobs (not even on the same planet) but he can fill the CEO position as well as anyone there. It’s a giant, nameless, faceless corporation that will just ‘be’.
Dell, OTOH, can go straight to he11.
Beleaguered
Microsoft’s problem is that they became so reliant their Windows dominance, and things directly related to Windows such as Office and server software, for “guaranteed” profit, year after year. They don’t know how to behave like “for-profit” corporation anymore.
Because of the Windows cash cow, Microsoft just throws poorly designed and executed products out there, then throws money at it to make it better over time. Or they throw marketing money at it to fool consumers. It’s almost as if profitability and desirability for a new product are secondary considerations. Who needs more profit – we have Windows… In contrast, Apple’s new products are profitable from day one. Unless there is a clear strategy to make a new product immediately profitable, the product does not ship.
And now, Microsoft’s cash cow is dying. It WAS a slow process, until Windows 8/RT and Surface. Microsoft does not know how to prosper (let alone survive) without Windows bringing in that “automatic” profit.
I love Ballmer!!! Bestest CEO EVER!
I’m curious…what has Tim Cook done for Apple whilst being in charge?
Good question. But then, what did Steve jobs do in the 6 years between the release of the iPod and iPhone?
Microsoft can rely for a very long time on their cash cows bringing home the bacon (a deliberate mixed metaphor, yes) because there are many, many s-l-o-w m-o-v-i-n-g corporations out there that have firmly entrenched Microsoft shops in their IT departments. Across the planet we are probably talking hundreds of thousands of large to huge companies that fit this description.
I used to work for a company like that but their stubbornness and resistance to change in the face of their customers demands and needs eventually drove me away. And like Microsoft, these companies, if they don’t wake up to themselves, will eventually fade away.
I don’t see MS EVER waking up.
What you said would have been true, IF Microsoft had done the smart thing. Continue to improve Windows 7. Separately release an OS that is focused on tablets and touch-based interface.
But Windows 8 changed the story considerably. The “experts” expected PC sales to rebound after Windows 8 was released, because there was supposedly pent-up demand. And that must be true, because apparently, over one-third of Windows users are still using Windows XP on aging hardware. Instead, PC sales declined further. What does that mean?
It means that most customers, consumers and enterprise, do NOT want a to use a tablet as their primary computer, and they do not want a laptop or desktop computer with a touchscreen. Instead of buying a new computer with Windows 8, they prefer to delay the purchase.
“Stubbornness and resistance to change” is precisely why they do not want Windows 8. Microsoft made switching to a Mac the path to “less change” for many customers, compared to “upgrading” to Windows 8. But for now, most of those existing Windows customers will just delay, even the ones still using XP.
To recover, Microsoft needs to quickly admit to their mistake and go back to fully supporting and appreciating their core customers, who mostly want to use “normal” computers. If Microsoft stubborning continues with Windows 8, the “death spiral” accelerates.
What I call “Marketing-As-Management”, the surest way to tank a company:
So a different group of people start to move up. And who usually ends up running the show? The sales guy… Then one day, the monopoly expires for whatever reason. But by then the best product people have left, or they’re no longer listened to. And so the company goes through this tumultuous time, and it either survives or it doesn’t.
∑ = NEVER allow marketing executives into leadership positions. They quite literally and deliberately DESTROY the productive/creative people in any company they lead. Why? Because the relational marketing folks DESPISE them, specifically because productive/creative people are NOT into relational game playing. They have better things to do. Thus they are marked for harassment, bullying and demolition. It’s damned scary to watch and damned scary to experience if you are one of the producer/creatives.
Don’t ever let it happen. Apple were incredibly wise and lucky to bring back Steve Jobs and kill off the reign of marketing. May it NEVER happen again at Apple!
Been there, seen that first hand at Kodak, watched Kodak fall over a cliff of FAIL. R.I.P.