DISQUS

Kim Feraday · 11 months ago

Interesting but I think any large company is inevitably going to act in similar ways. They need to expand reach in order to grow revenue. Any technology that is adjacent to core products is going to be fair game. The company can either move into these spaces organically or through acquisition. If you're in an adjacent space, you're an acquisition target, if not then you may be in for a tough fight. If you're lucky you can find a profitable niche (either geographical or industry) and establish some barriers that way. MS did this to us in the 90's (Delrina). But then Netscape tried to do similar things at a small company I went to after.

Conrad Barwa · 11 months ago

A business ecosystem is like a natural one. It doesn’t matter how nutrient rich the environment (like say, one with excellent development tools) if emerging lifeforms are consistently snuffed out, pretty soon they will elect to grow and evolve elsewhere - even in places where the nutrients are weaker.

This is a slightly optmistic reading imo; you assume that the so-called "emerging lifeforms" have the freedom of choice to move elsewhere. That is a big if, plausible in some situations but not in all

Christopher Blizzard · 11 months ago

Tim O'Reilly's recent essay on working on things that matter seems relevant here:

http://radar.oreilly.com/2009/01/work-on-stuff-...

"Take Microsoft. They started out with a big goal, "a computer on every desk and in every home," and for many years unquestionably created more value than they captured. They helped grow the PC industry as a whole; they built a platform that helped many small software vendors to flourish. But over time, they began to capture more value than they created: as the cost of PCs plummeted, hardware vendors had to survive on the slimmest of margins while Microsoft collected monopoly rents; bit by bit, Microsoft consumed its own developer ecosystem by building the features of successful startups into their own products, and using their operating system dominance to crush the early movers. As I've written elsewhere, I believe that Microsoft must re-commit itself to big goals beyond its own profitability, and to creating more value than it captures if it is to succeed. (Danny Sullivan wrote a great piece about the strategic relevance of this very idea just last week, Tough Love for Microsoft Search.) "

I tend to agree with this. Big companies with leverage need to be able to walk away from possible value with the understanding that the soft value of the ecosystem is more important than the short-term value of competing with those who complement them.

I think that one of the main problems is that that "soft value" is very hard to measure when compared with the hard dollars you realize that you're leaving on the table. And if you can't measure it it's hard to compete in a conversation inside of one of those companies. I can almost hear it in my head now where one guy says "these things help us" and someone else says "that's money we can return to our shareholders and they might grow to kill us anyway." So the money-left-on-the-table argument wins.

This is one reason why I'm a fan of companies that can look past the next quarter, or don't have to worry about that pressure at all. And I wonder what Microsoft would look like if it went private.

Andrew · 11 months ago

I agree. The fact that you have written this now and almost mentioned some of the points made by Joel Spolsky in his essay of some years ago shows that he was right about a lot of things.

http://www.joelonsoftware.com/articles/APIWar.html

I think even Microsoft internally would recognize that breaking the backwards-compatibility of Visual Basic, while cool and nifty in the short-term, was a serious long-term mistake.

Even though they clearly did succeed in cutting off Netscape's air supply, Firefox lives on because it is open source. And yes, developers moved to niche platforms where Microsoft would leave them alone long enough for them to create something cool - Linux, OS X and what we now call Web2.0

They forced all the action and futuremaking to move to the iPhone and the cloud. How many rich clients made with wonderful old .NET do we use today?

Joel's other important point here was that Microsoft inherited it's monopoly from IBM and so abused it for as long as it could. Google earned it's 85% market share by being superior. Although that may not mean it fares any better.

Does anyone think the stock market has registered this long term weakness at Microsoft over the next decade, or is it just way down anyway because everything is?