fedward, tumbling

Okay, This Really Puts The Microsoft-Apple War In Perspective (via tbridge)

This doesn’t really tell us much except about the herd mentality of investors. Henry Blodget is an interesting writer, but I still believe any analysis of his to be suspect. Also, market cap merely tells us that a company is popular, not that it is well managed. It is important to look at revenue and earnings per share, not just market cap (Apple’s P/E ratio is much higher than Microsoft’s, and isn’t at a particularly healthy level). Microsoft still has a couple money-printing machines called Windows and Office, despite their failures to conquer new markets in the way Apple has.

If Microsoft could manage to turn its size and significant R&D budgets into growth in new markets, it has the potential to convert that size into a serious challenge. That they have continued to fail at that is still astounding. Apple is overvalued based on a string of successes taking over emerging markets (the iPod), revolutionizing existing markets (the iPhone), and, apparently, giving value to new market segments (tablets, non-computer computers, etc., as illustrated by the iPad). Microsoft should have been able to take over the gaming world with the Xbox 360 (their development platform is second to none, and they were first to market); instead they somehow lost the technology competition to Sony (despite the noted difficulties of developing for the PS3 platform) and the overall gaming market to the Wii (because the 360 wasn’t what the market actually wanted, it turned out). So now there’s yet another shakeup at Microsoft, which won’t help them take over any new markets any time soon.

Op-Ed Contributor - Microsoft’s Creative Destruction - NYTimes.com

I don’t have a problem with Microsoft the company, but I’m not particularly fond of Windows or Office - because neither one shows much evidence of anybody ever being willing to take anything out, much less leave something out to begin with. Got an idea? Throw it in! Got another idea that makes the first idea seem ill-considered? Throw that one in too, but don’t take the first one out!

That said, though, the op-ed is worth reading because the long, slow failure of Microsoft (as it can’t come up with anything new the way Apple or Google can) is sad more than anything else. A company that mighty ought to be able to innovate, and that they can’t is very telling.