The big internet meme today seems to be that Microsoft is dead, and to claim that a multibillion dollar company that is still making enormous profits is dead is no mean feat.
But I think that Graham has it right. MS is definitely operating in catch-up mode, and they really don’t have a good sense of what people want. I personally think that they killed themselves, by being too aggressive, too arrogant, too confrontational. This resulted in the string of anti-trust judgements that they eventually lost. And it wasn’t really the losing that did it. It was more the fact that they had to waste a lot of their time fighting these cases. Through these years locked up in the courtroom, little-to-no innovation came out of Redmond, and Google and Apple took advantage of the lack of opposition. MS also wasted time competing with other old-style tech and media companies, like Time-Warner/AOL, Disney, and Sony, to name a few supercorporations that seem to have lost the sense of what the purpose of business is for—to sell people things they actually want, and these companies have also declined in stature to a degree.
It seems to add credence to the idea that CEOs simply can’t relate to the common person. Their heads are too far in the clouds, spinning multibillion dollar deals and keeping the shareholders happy. What they’ve lost touch with is the product, the thing that actually makes them money. Instead of actually focusing on something that people want to buy, they just turn out iterations of things they’ve already made. This doesn’t even work well in the bulky, slow-paced field of something like the auto industry. Look at what’s happened to Ford, GM, Chrysler, by ignoring what people want—fuel economic cars—and instead churning out more of the same—monstrous SUVs that have no practical purpose whatsoever.
Lose the ability to innovate, and it’s over.
You can’t force people to like crappy stuff. You have to make something they’ll actually buy.
In Apple’s case, their ticket to success is obvious. The iPod is neither original nor superior, but it happened to arrive at the perfect time. While Zens and Archos Jukeboxes and Sansas and Zunes are targetted at the geek demographic with their multifarious functions and panels full of buttons, the iPod is made for the average person who can turn it on and play music on it and transfer music from their computer with ease. There are few things that are so brain-dead simple as using an iPod. It’s no exaggeration that it’s compared widely to the Sony Walkman.
You do one thing well, and you stick to it.
And simple means being able to pick a thing up and use it without having to even open up a user’s manual, much less read it.
Apple has mastered the idea of simplicity and elegance. These are the precise things you look for in luxury items. The reason why someone would buy a $60,000 car and not a $10,000 car, even though both of them will get you from point A to point B. And that’s Apple’s niche, really, all this time, all the way back to the very first Macintosh. They know what they make, and their clientele stays happy. Even when Apple was dying without Steve Jobs, they were still churning out computers. Not all of them were exactly the epitomé of simplicity and elegance, but they had enough hits to make up for the misses, and they managed to survive until Steve-o came back to town.
Sony was probably the only one who could’ve done something about the iPod, but they screwed it up years ago by enforcing copy-protection and DRM. Hence, the failure of Mini-Disc, and the laughable attempt at catching up with Apple with their ATRAC-based players. By being hostile to the customer and burdening them with things that they don’t want, they ended up losing a great deal of the market. The same thing can be said of the PS3, which is far too expensive for how little it provides. Then again, Sony seems to be in love with proprietary formats. It’s kind of funny how they never learned their lesson from losing the VHS/Betamax war.
But what exactly does Google sell, you might ask? After all, I use Google all the time, and have yet to pony-up any money to them directly, although granted, I’ve probably clicked on more than a few of their advertisers.
The thing is, Google is ubiquitous. People are half-seriously wondering if Google might be God. It can certainly perform the function of an oracle. Google has the ubiquity that radio and television has only ever dreamed of.
This ubiquity allows them the ability to command premiums for advertising space, and essentially that is the bulk of their business.
But the thing is, they know what their product is: most obviously it’s a search engine, but just as importantly, they sell trust. As long as we can trust Pagerank to work well and not get overthrown by SEOs and blog-spam, the trust we lend Google is pure gold. The moment anyone starts distrusting Google is the moment that their Empire will start their great fall. And because they know what their product is, they know that they have to do this one thing as best as possible. Everything else, as ephemeral and peripheral as it seems, is about search. Think about Gmail. They’re not really showing off a web-based e-mail client. They’re showing off what their search can do. Think about the reason why you probably off-loaded all your e-mail into Gmail—you wanted to be able to utilize their awesome search engine to index your stuff. And it works beautifully.
Look at Google Desktop. Again, the key functionality is search. Same thing with Google Maps, Google Earth. They exist to help you find things. This is the thing that Google is good at. And they’re doing it to the tune of millions of dollars a day.
You look at the vast multiheaded supercorporations, and it’s hard to see what they do well. We come back to Microsoft. You might say that they do OSes well, and certainly, that’s where much of their money is made. But do they really do OSes well? Consider that the 30 year old architecture known as UNIX still runs most of what we call the Internet, and that only foolish sysadmins would risk running anything else on mission-critical tasks. While MS apologists like to scoff at the fact that UNIX is ancient, I think the fact that it’s core is mostly unchanged is testament to the fact that it works so well. And consider that one of the more modern OSes out there—Mac OS X—is nonetheless based on UNIX.
Where Microsoft most definitely kills themselves is with Vista. For one thing, it’s nothing more than a catch-up gambit with Mac OS X, which has already had an 8 year head start (and more, if you consider it’s NeXT roots) There ain’t nothing new under the sun with Vista. It was already stale when it was released.
But the serious death-knell is all the intrusive DRM crap that most people don’t want. Who wants to upgrade and then not be able to view porn? This is probably the biggest reason why people downgrade back to XP—they don’t want to deal with draconian copyright protection garbage that might accidentally lock them out of their system. Who wants to buy something that will give you less features than what you already have?
What Microsoft does relatively well which has no real peer is productivity software. The ubiquity of Word, Excel, and Powerpoint is a testament to that, and really, if you look around, everything else are really just pale clones to this enduring office suite.
But the cores of these technologies have been pretty much unchanged since the GUI became the standard user interface for most computers. What exactly does Word 2007 do that Word 2.0 can’t? Besides being excessively bloated and chock-filled with features I don’t need and I don’t want, that is? (Thank God they killed Clippy.) Oh, I’m sure some power-user can point something out that I’ve overlooked, but frankly, all I really need word for is typing out simple documents, which, if you think about it, can really be simply addressed by markup like XHTML (which has the added advantage of being immediately available on the web for viewing.)
The only time I’ve seriously had to load up Word is whenever someone mails me a DOC file even though a PDF or even a plain text file would do.
I tend to do most of my writing in things like Emacs, TextEdit.app, the text area in Wordpress, or the text area in Gmail anyway, and while I used to be a big font junkie, that’s not really a serious loss, particularly since if I wanted to actually publish something in dead-tree format, I would use a DTP program.
People talk about innovation like it’s something magic and transcendant, but I think it’s really about having your finger on the pulse of the customer. The way the market works, people buy things they like, and you start putting things in your product that people don’t like, and even if it’s a little thing like DRM or Clippy, it’s enough to demonstrate that you don’t really have the customer’s best interest in mind. It’s not enough to aspire to feature creep, either. So what if your new product has 200 new things in it, if it’s not anything anyone will use.
You might argue that they don’t just want some of this stuff, they need it, and many use this argument for the reason why desktop OSes and word processing software persist, but realistically, there are very few things that you actually need besides food, shelter, and clothing, and even there, if you look at how those things are bought and sold, you can’t add features to these things that inconvenience and/or aggravate people. No one will buy it.
So yeah, like IBM before them, I’m sure Microsoft will be around for a long, long time, but then again, I won’t be surprised if they simply become the biggest software publisher for Mac OS X, either.