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Motley Fool Writes Off Microsoft 404

Posted by kdawson
from the limited-vistas dept.
The Vista disaster has caught Wall Street's attention before but I've never seen the popular press understand the issues like this argument in the Motley Fool. The opposing argument is a weak statement of faith, essentially "as it was in the beginning is now and forever shall be." "You don't need to watch the 'I'm a Mac, I'm a PC' commercials to see that Microsoft is taking a beating. You see it in the company's financials where its online unit, incredibly, is operating at a loss; overheating Xbox 360 consoles find the company taking a huge warranty hit for a system losing market share to the Wii; and the upgrade wave of its flagship operating system has been more of a ripple than a tsunami. That last point is important. This was supposed to be Microsoft's final feast, the major last hurrah for its Windows Vista operating entry and its Office 2007 suite of applications before the inevitable embrace of cheaper open source operating systems and Web-based apps... In fact, even Microsoft will tell you that its fortunes peaked several months ago."
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Motley Fool Writes Off Microsoft

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  • In other news (Score:5, Insightful)

    by El Cabri (13930) on Friday January 25, 2008 @11:16AM (#22181578) Journal
    MSFT shares are up 3% today after another strong rise yesterday, after announcing their financial results and outlook.
    • by Otter (3800) on Friday January 25, 2008 @11:23AM (#22181662) Journal
      I'm accustomed to "X writes something in Y arguing that..." being reported as "Y says..." It takes real journalistic skill, though, to turn what's obviously a point-counterpoint piece into "Motley Fool Writes Off Microsoft".
    • Re:In other news (Score:5, Insightful)

      by eldavojohn (898314) * <eldavojohn@@@gmail...com> on Friday January 25, 2008 @11:26AM (#22181718) Journal

      MSFT shares are up 3% today after another strong rise yesterday, after announcing their financial results and outlook.
      Yeah, I noticed that on MSN Money when I was running at the gym last night. The reason they cited that was strong Vista sales. That's not what I've heard on Slashdot.

      Now I know he's a Microsoft robot but on the otherside of this issue is Ed Bott [zdnet.com] who cites adoption rates. Of course there are other factors like Vista being forced down people's throats.

      You have to admit, the stories we're hearing just don't add up. People can spin this like Vista's a flop or success. I'm guessing it's par for the course and Microsoft is doing fine. My company will be shoving Vista onto my workstation in a year and it's hear to stay.

      Do I like Vista? Not at all. That still doesn't mean I should live under a rock in denial.
      • Re: (Score:2, Interesting)

        by AvitarX (172628)
        Isn't it not uncommon for businesses to skip entire versions of windows?

        With the next version coming quick (allegedly) I don't see any compelling reason to not go XP -> 7 without dealing with Vista at all. It was only recently that new software stopped working with Windows 98.
        • Re:In other news (Score:5, Insightful)

          by MightyYar (622222) on Friday January 25, 2008 @11:47AM (#22181958)

          Isn't it not uncommon for businesses to skip entire versions of windows?
          It is not not not uncommon at all! :)

          My company was not in love with '98, so made the jump quickly to 2000, but then stuck 2000 on every machine that came in the door until they had trouble making new hardware work (laptops, for instance, just remained XP). Last time I checked, they were still blocking SP2 - though I've been working remotely for 2 years so that might not still be the case. The loaner PC that I use when I visit is still 2000. I suspect they will be similarly slow to adopt Vista, and may skip it altogether if MS releases another OS quickly enough.

          Then again, my company still runs Exchange 5.5 and just tells everyone to clench during daylight savings :)

          Personally, I won't upgrade my PC to Vista, but if I happen to buy one with it pre-installed I won't remove it, either. I've set up some Vista machines for people and played with it quite a bit now - it's really not so bad. It just has some new irritations, and some things are flat-out impossible to do (or at least not that I could figure out with the help of Google). But on the whole it is stable and not really much different day-to-day than XP.
        • Re: NT 3.51 to XP (Score:2, Interesting)

          by colinnwn (677715)
          Good point, and you are right on businesses (even large ones) skipping entire versions of Windows. The transportation company I work for ($10 billion in revenue) went straight from NT 3.51 to XP about 2 years ago.
        • Re:In other news (Score:5, Informative)

          by ipxodi (156633) on Friday January 25, 2008 @02:05PM (#22184152) Homepage
          Absolutely common to skip versions.
          My company went from 95/98 directly to XP. Even with Office we still have most of the installs at Office 97 or 2000 with only a few Office 2003 copies.

          When we upgrade, I expect it will be directly to "Windows 7". And since I'm the IT Director, my expectations will probably prove accurate. ;)

          Being a small company, the cost of upgrading is prohibitive, so we squeeze the last bit of usage out of our expenditures.
      • Re: (Score:3, Interesting)

        by maxume (22995)
        If Vista is indeed a failure, it is only a failure in context, most companies would be glad to have such a failure on their balance sheet.
      • by Otter (3800)
        That's not what I've heard on Slashdot...You have to admit, the stories we're hearing just don't add up.

        Wow, that's a real conundrum! I wonder what the explanation could be?

      • Re: (Score:2, Insightful)

        by peragrin (659227)
        MSFT is selling Vista for 2-4 times what XP went for. MSFT could sell 200% less copies of Vista and still come out ahead of XP money wise.

        especially in order to get the same functionality as XP PRO, or Leopard (both of which sold for ~$130)you have to buy the $400 version.

        So yea of course MSFT is seeing strong sales numbers. if I doubled the price of my product while having an illegal monopoly I woudl see strong sales figures as well..
        • Re: (Score:3, Informative)

          by darthflo (1095225)
          No. If they sold 200% less copies of Vista than XP, they'd buy as many Vista licenses (from whomever would sell them to MSFT) than they sold XP licenses. 200% less than 100 copies sold is minus 100 copies sold, i.e. 100 copies bought. 50% less than 100 copies sold is 50 copies sold, of which, in turns, 200% copies sold would be 100 copies.

          Also, Vista Ultimate is sold for some $200 (OEM) to $210 (Upgrade if you insist on retail packaging). Using the $400 retail price tag for comparison doesn't work out bec
        • Re: (Score:3, Interesting)

          by necrogram (675897)
          [quote]especially in order to get the same functionality as XP PRO, or Leopard (both of which sold for ~$130)you have to buy the $400 version.[/quote]

          Thats wrong. Vista Business == XP Pro. Ultimate is Business + Media center + Bitlocker. Retail for Vista Business is 300. Retail for XP Pro is 300.

          are there some suck ass bugs in vista? You bet! I haven't seen many show stoppers. theres the change in group policy processing sucks monkey balls, but now i know what to look for, its easy to fix. the dhcp clie
        • Re:In other news (Score:5, Insightful)

          by prisoner-of-enigma (535770) on Friday January 25, 2008 @02:48PM (#22184824) Homepage
          MSFT is selling Vista for 2-4 times what XP went for.


          Not true at all. My corporate licensing rates on a per-license basis show Vista Business coming in at exactly the same price point as WinXP. I don't know who you're getting your pricing from, but they're taking you for a huge ride if you're paying 400% more for Vista than you did for XP. Heck, even the retail pricing is similar.

          On the other hand, if you've got some sort of ideological axe to grind against MS, you might've tried comparing something silly like XP Home with Vista Ultimate in order to get your ridiculous price differential. I'd like to believe you're not one of the slobbering, frothing, anti-MS zealots Slashdot is so rabidly famous for, so I'm going to assume you're just getting bum pricing from whatever vendor you're using. Given your comments, though, I'm thinking that's not the case with you, is it?
      • Re:In other news (Score:4, Insightful)

        by sm62704 (957197) on Friday January 25, 2008 @12:07PM (#22182216) Journal
        The reason they cited that was strong Vista sales

        Actually Vista is selling like hotcakes. Dell is buying lots of copies, Gateway is buying lots of copies, Sony is buying lots of copies, OEMs are buying lots of copies.

        The only people who aren't buying Vista are businesses that aren't making computers, home computer owners, upgraders, and everybody else.

        -mcgrew

        (no journal for YOU! You;ll have to make do with reruns. Happy DT.)
      • It's neither. (Score:5, Interesting)

        by babbling (952366) on Friday January 25, 2008 @12:16PM (#22182352)
        I doubt Vista is a huge flop or a tremendous success.

        What's much more interesting is the cash reserves. Dropping by over $10 billion per year? Really?! Are those numbers accurate?
        • Re: (Score:3, Insightful)

          by QRDeNameland (873957)

          That was the eye-popping part to me as well. I really had no idea their cash reserves were being so heavily depleted.

          Which kind of goes against the bullish argument that they have no debt and large cash reserves, doesn't it? If they've burned through $40 billion of reserves in 3 years, if they do the same over the next 3 years they be around $20 billion in debt. At that level of finance, is there any real difference between burning through $40 billion of reserves vs. taking on $40 billion in debt?

          • Re:It's neither. (Score:5, Informative)

            by LupusUF (512364) on Friday January 25, 2008 @03:15PM (#22185188)
            Which kind of goes against the bullish argument that they have no debt and large cash reserves, doesn't it? If they've burned through $40 billion of reserves in 3 years, if they do the same over the next 3 years they be around $20 billion in debt.


            They have been paying out a lot of dividends over the last few years, and have been putting money into new tech. Depleting their cash reserves is not a sign of weakness, it is a purposeful response to shareholder complaints. A few years back they faced a lot of criticism from shareholders because they had to large of a cash reserve. Why is this a problem? Cash reserves are not making the company (or shareholders) any money. If a company can't find anything to do with their cash reserves that they think will meet their required rate of return on investment (ie: invest in R&D, capital, or other ways to improve the future profitability of the company), they should return that money to shareholders via dividends.


            Their current depletion of cash does not suggest that they will be in debt in a few years. Once they have lowered their cash reserves to a level deemed appropriate by their shareholders, they will change their strategy. So to answer your question, yes there is a huge difference in eliminating 40 billion in reserves and taking on 40 billion into debt.

      • Re: (Score:3, Informative)

        by Columcille (88542) *
        That's not what I've heard on Slashdot.

        Expecting to see any accurate reporting about Microsoft on Slashdot is foolish naivety at best.
      • Re:In other news (Score:4, Informative)

        by Lally Singh (3427) on Friday January 25, 2008 @02:49PM (#22184832) Journal
        All things aside, one way to look at vista's success is the software itself. XP was a desirable set of changes for the end user from ME/98/NT, but Vista?

        What was it, really? Sure, it's shipped on (some) new machines, but is there much reason to upgrade for most, the same way XP was?

        IMHO, no.

    • by canuck57 (662392)

      MSFT shares are up 3% today after another strong rise yesterday, after announcing their financial results and outlook.

      True. Selling 2 licenses, one for bundled-Vista and another to usergrade it to XP is a real good way to boost sales. But it will not last. Lets see what happens in Q2 when the X-Box returns are in.

      And a rise over a market crash? Some of my stocks are up 10% in 2 days and 3% is on the lean side.

      • And yet this argument is invalid because most people know that Vista includes downgrade rights to XP Home or XP Pro. You don't need to buy XP again. They aren't artificially boosting sales in this manner, at least not on a wide scale.

        The reason Microsoft has always been a good stock buy even though the stock price has dropped through the roof in recent years, is they consistently make money. I expect there are enough smart people in that organization that they will continue to put out products that make
      • by Vancorps (746090)

        Except that Microsoft doesn't sell a license to downgrade to XP. It's the same with all Microsoft products, if you buy the latest version you can use an older version without worry. A lot of SQL 2005 buyers ran into that as a lot of apps still require SQL 2000. All you do is call up MS and they give you a product key that will work for the older app. Depending on how you purchased it you can even download it from their VL site.

        Also, a stock valued as high as Microsoft's moving 3% is quite a big deal but t

  • by Anonymous Coward
    "Weak statement of faith", twitter? That's rich coming from someone whose faith in his own assertions is so weak that he chose to disable comments in his journal rather than make a real effort at refuting critics who post in it.
  • And yet... (Score:5, Insightful)

    by squiggleslash (241428) on Friday January 25, 2008 @11:16AM (#22181582) Homepage Journal

    ...despite Vista's problems, Microsoft announced a 79% rise in profits [yahoo.com] today. I guess they can survive one OS screw-up.

    Here's hoping HD DVD's troubles means that they'll remove all the "secure path" BS from Windows 7. They only did it to placate Hollywood, and it's a major reason why Vista had developmental problems. (Note, they'd have had to do it too if they were supporting Blu-ray instead - the point though is that I'd like to see Microsoft throw a tantrum and remove a "feature" they should never have added in the first place.)

    • Re:And yet... (Score:5, Insightful)

      by bizitch (546406) on Friday January 25, 2008 @11:30AM (#22181754) Homepage
      Right

      They survived Windows Me and they already announced (leaked) the next OS is on the way sooner than thought

      They also have more money than God - So they will adopt, adapt and improve (and steal, and "innovate" etc etc)
      • Re:And yet... (Score:5, Insightful)

        by MBGMorden (803437) on Friday January 25, 2008 @12:00PM (#22182132)

        They also have more money than God
        Major point there. No company is permanent or invincible, but Microsoft is the type of behemoth that can bleed off small ammounts of money for DECADES without folding.

        They are still turning a (sizable) profit. They not only need to start taking a loss, but they need to either start taking a MAJOR loss each quarter (doesn't look likely), or, we gotta wait it out. As long as they're managed just well enough that their losses are minor, I doubt we'll see Microsoft go away in the foreseeable future.

        Still, that doesn't mean that they need maintain their current control for that long. I'd love to see Microsoft in 15 years, putting out their OS that only has about 25-30% market share, and shipping Office for Linux (and naturally Mac, but they already do that so no big change there). Xbox would likely be scrapped by then (admittedly though, the 360 is the only current gen system I own, but I bought it pretty much exclusively for Mass Effect).

        If Linux could just get that level of commercial support, I think it would be a major victory. I'll admit that, though not the only things, having WoW and MS Office available are major factors in my preference of MacOS over Linux right now. Linux is ideologically the better way to make software, and I hope to goodness that within the next few years it gets the functionality, polish, and commercial support to be functionally the better of the two as well. Microsoft has already proven that Windows is steering towards crippleware, and Apple is likely not far behind.
    • by ednopantz (467288)
      I find amazing that anybody can seriously suggest that this is a company in a weak position.

      Anybody who does just has very little sense for how far this company has come in the past 10 years in terms of the breadth of their product offerings and their success in penetrating markets.

      1998 (right before the Internet was going to destroy MS):
      near monopoly (>90%)in OS, Office suites, internal only server use
      2008:
      near monopoly (>90%)in OS, Office suites, major player (>30%) in game console, smart mobile,
    • They only did it to placate Hollywood, and it's a major reason why Vista had developmental problems.

      No, they did it to "embrace, extend, and extinguish" Hollywood itself in a bid for total power over the end user.

      If Vista-style DRM becomes the norm for all Hollywood releases, then:

      1) F/OSS gets shut out of the legitimate playback market. Hollywood doesn't care because Mac and Windows stay in.

      2) Software-as-a-service where the software is very fat desktop applications is much easier to support. (And let'
  • by acvh (120205) <geek AT mscigars DOT com> on Friday January 25, 2008 @11:16AM (#22181586) Homepage
    AP
    Microsoft Tops Street in 2Q; PC Sales Up
    Friday January 25, 9:45 am ET
    By Jessica Mintz, AP Technology Writer
    Microsoft Beats Street in 2nd Quarter; Vista, Office, Xbox Games Helped

    SEATTLE (AP) -- Microsoft Corp. forecast a rosy 2008 -- despite broader economic worries -- after it blew by Wall Street's expectations for a second consecutive quarter.
    "We will be impacted just like everybody else," if the U.S. falls into a recession, Chief Financial Officer Chris Liddell said Thursday. "But overall, we feel very optimistic about our second half."

    Company officials touted rising sales in each of Microsoft's business divisions, a slate of important upcoming business-software launches and the growing contribution from sales in non-U.S. markets.

    Microsoft raised its outlook Thursday for the rest of its fiscal year, which ends in June, matching Wall Street's forecast and sending shares up in after-hours trading.

    The software maker's quarterly earnings jumped 79 percent to $4.71 billion, or 50 cents per share, from $2.63 billion, or 26 cents per share in the second quarter a year earlier. Quarterly revenue climbed 31 percent to $16.37 billion from $12.5 billion.
    • by moderatorrater (1095745) on Friday January 25, 2008 @12:39PM (#22182632)
      It was a debate. While slashdot wrote off the rebuttal, it's actually a well written and well thought out argument. Also, you'll notice that Microsoft is an inside value pick, meaning it's a safe bet stock because it's undervalued compared to it's debt, earnings and holding.

      The arguments boil down to one guy saying that you're an idiot if you think that Microsoft is going away, the other one says that Microsoft is on the decline, and since it's not the big winner it's a loser. In my opinion, they're both right, although the one saying that Microsoft is a loser takes the longer look and, therefore, more risk of being wrong (what happens if the XBox becomes the PS2 of this generation of systems?). Slashdot got this one wrong, not The Fool.
    • by PinkyDead (862370) on Friday January 25, 2008 @01:43PM (#22183794) Journal
      Those statistics you quote are interesting, and definitely look good for Microsoft. However, just a quick look a google finance's view of them: http://finance.google.com/finance?q=MSFT [google.com]
      tells a different story.

      The income is good, but they've just released a new product. That's to be expected.

      Looking at the balance sheet though, their numbers are not so good. The actual value of the company is weakening while at the same time their liabilities are rising - at a time when their liabilities should be reducing due to the end of the development costs of Vista.

      And then even worse their cash situation is looking very bleak - especially when you consider that the US is heading for a recession (to survive a recession you need cash and as much of it as you can get).

      The have a new product out which should be selling for cash - their balance sheet should be rising as should their cashflow. It isn't.
  • Uhh... (Score:5, Informative)

    by Anonymous Coward on Friday January 25, 2008 @11:17AM (#22181588)
    What part of Microsoft's record earnings yesterday did Slashdot seem to overlook? I think the joke is on us.

    http://www.news.com/8301-13860_3-9857633-56.html?tag=newsmap [news.com]
  • by wwwillem (253720) on Friday January 25, 2008 @11:17AM (#22181596) Homepage
    Hasta la Vista, Baby .....
    • by FauxPasIII (75900)
      > Hasta la Vista, Baby .....

      How long have you been waiting to use that? =)
  • by dyslexicbunny (940925) on Friday January 25, 2008 @11:19AM (#22181624)
    'Mötley Crüe Writes Off Microsoft'

    Gonna be a long day...
  • This is especially clear now that Windows 7 is on the horizon. And if MS can survive ME, it can survive anything.
    • Re: (Score:2, Insightful)

      by KillaBeave (1037250)
      Wow ... "Vista is the Windows ME of our generation" (emphasis mine)

      I didn't know a generation had passed since I bought ME in college (for $5 through school).

      KillaBeave == Old, Sad Panda
    • Re: (Score:2, Insightful)

      Plus as long as Apple computers continue to be significantly more expensive than Windows based computers Microsoft is still gonna stay in business regardless of how lame Vista may be.
      I mean you can buy a frigging $400 pc laptop. It'll run your word processor, internet and whatever other work like things non graphics types run. Whereas the starting price of Apple laptops is $1200

      AND you can say what you want about Linux, but for the average smuck walking around a best buy with a wad of cash it's not even on
  • They Must Be Short (Score:2, Informative)

    by dsginter (104154)
    Microsoft just posted great earnings [yahoo.com]. While I'm no fan of the Microsoft, I always see these wonderfully timed stories and wonder who is paying for them (e.g. - trying to scare up liquidity).

    If the Motley Fool and others wanted any dignity at all, they'd shut up and do this sort of reporting for non-event days.
  • Interesting (Score:3, Insightful)

    by Paranatural (661514) on Friday January 25, 2008 @11:22AM (#22181656)
    While I can see this as a mark of the beginning of the end for Microsoft I really wouldn't write them off just yet. They still have a metric butt-ton of market share, and are still overall profitable. Should they manage to stop the hemorrhaging of cash with the XBox (Which I can easily foresee) and come up with a good reply to Vista (Like they did with Windows ME/Then Windows 2000), then I can see them rebounding quick.

    However, I also see the general public becoming more and more sophisticated when it comes to things like Operating Systems and understanding that there are indeed options out there. And with knowledge of options will come people exercising those options.

    In other words there's a up and down roller coaster ride ahead but this ride may be coming to a full and complete stop.
  • by Dr. Manhattan (29720) <{sorceror171} {at} {gmail.com}> on Friday January 25, 2008 @11:24AM (#22181676) Homepage
    IBM came out with the PS/2 [wikipedia.org] and the Micro Channel [wikipedia.org] bus. They fenced it with patents and wanted to charge high fees for people developing hardware and such for Micro Channel. IBM didn't want to get burned like they had before with the PC clones.

    But people failed to beat a path to the PS/2; they waited, and used things like EISA [wikipedia.org] until PCI [wikipedia.org] came along and was roughly as good as Micro Channel. IBM finally learned that they didn't own the PC market anymore.

    IBM's still around but isn't a colossus astride the computing industry. Microsoft has now discovered that the competition is "good enough" and the Microsoft name isn't enough to force people to follow along with whatever they say. Like IBM, MS isn't going away... but they'll be one option among many in a few years, not the single dominant giant.

    • Bad Analogy (Score:4, Insightful)

      by dreamchaser (49529) on Friday January 25, 2008 @11:34AM (#22181808) Homepage Journal
      Vista is not Micro Channel. Vista is Windows ME.
      • Vista is not Micro Channel. Vista is Windows ME.

        The environment around Vista is very different from the environment that surrounded Windows ME. Except for hardcore gaming, inexpensive PCs are available that can do everything a home user would want to do already, and most things corporate desktops would want, too. Vista's price is a much bigger percentage of that hardware cost, and Vista itself simply cannot run well on typical computers - it needs high-end hardware to run acceptably. ME would at least run

    • and if it is like Millenium Edition, they'll get over it and bring out another version in a year (if we believe the rumours) or two (if we believe the forecasts) or three (if we believe our experience).

      There's a lot of life in the ole dog yet

    • by canUbeleiveIT (787307) on Friday January 25, 2008 @12:00PM (#22182124)
      Like IBM, MS isn't going away... but they'll be one option among many in a few years, not the single dominant giant.

      As much as I'd like to believe this, I see no indication that it will actually happen.

      In my mind, it is software, not hardware, that locks people into Windows. I am a VAR who mostly services businesses too small to have an IT staff, and it seems that every sector has an industry-specific software that only runs on Windows. Examples from my customers include:
      -Collision Repair Estimating Software
      -Accountant Software
      -Manufacturer's Representative Software
      -Dental Practice Software
      -Church Administrative Software

      It's kind of a chicken-or-the-egg dilema; developers would port to other platforms if those OSes's had more marketshare, and platforms would have more marketshare if applications were ported to to the OSes. I just can't see a short-term road out of that conundrum.
  • Last hurrah (Score:3, Insightful)

    by Malevolent Tester (1201209) * on Friday January 25, 2008 @11:25AM (#22181686) Journal
    I thought Vista was an interim OS between XP and Windows 7?
  • by Red Pointy Tail (127601) on Friday January 25, 2008 @11:25AM (#22181696)
    There is a corresponding Bull Argument [fool.com] that argues the Counterpoint - each with its own rebuttal of the other argument.

    So much for Motley Fool writing off Microsoft. Typically - guess which article gets highlighted in /.!
    • Re: (Score:2, Informative)

      by seyyah (986027)

      There is a corresponding Bull Argument that argues the Counterpoint - each with its own rebuttal of the other argument.

      Dude:

      The Vista disaster has caught Wall Street's attention before but I've never seen the popular press understand the issues like this argument in the Motley Fool. **** The opposing argument [fool.com] **** is a weak statement of faith, essentially "as it was in the beginning is now and forever shall be."

    • Re: (Score:3, Funny)

      by Matt Perry (793115)
      Wow. I've heard of not reading the article but you didn't even read the summary. You must be old here.
  • hmmm. (Score:3, Interesting)

    by apodyopsis (1048476) on Friday January 25, 2008 @11:28AM (#22181736)
    and WOOOSH! let the flame fest begin...

    except that this is /. and I don't see many MS defenders around here much. Personally MS are not very relevant to me, I only use Linux at home, even my gf only uses Linux. And my firm seems in now pressing hurry to upgrade to Office07 or Vista.

    In a year it has been out I have used Vista only once, and it was a very annoying experience indeed - more to the point I do not know anybody who actually uses Vista. Maybe this is the beginning of MS's slide into irrelevance.

    Of course, if Linux is the new boy around town we can expect virus writers to turn their attention to it big time and it to suffer the some of the same problems. I don't know what I prefer - insufferable bloat issues or raging dependency woes really.
    • by timeOday (582209)

      and WOOOSH! let the flame fest begin... except that this is /. and I don't see many MS defenders around here much.
      Heh, read all 20 messages above you.
  • by Rogerborg (306625) on Friday January 25, 2008 @11:30AM (#22181766) Homepage

    But it's in the first article, not the second.

    ZOMG, people are specifying XP instead of Vista! Sure, but they're still buying Microsoft. Apple is topping out its niche appeal, and corporations are run by lawyers who hate and fear Google Docs with a cold reptilian passion.

    Wise up, nerds. Major purchasing decisions are not taken by people live with their parents in Wyoming [penny-arcade.com]. They are taken by grown ups who have mortgages and orthodentist bills to pay, and those people recommend, and will continue to recommend, Microsoft because nobody ever got sacked for doing so.

    The upcoming recession may see a few smaller outfits switch to freeware in the hope of chiselling a few dollars off the budget, but that's probably a sign that they're doomed, and so wouldn't have been buying M$ one way or the other.

    Still, I'm swimming against the tide of opinion here, if not of history, so feel free to get excited about the prospect of the Evil Empire toppling any day now. Let's compare notes in 5 years and we can spot where you went wrong.

    • The term is "Nobody got fired for choosing IBM."

      Where are they now?
    • Re: (Score:3, Insightful)

      by Compholio (770966)

      They are taken by grown ups who have mortgages and orthodentist bills to pay, and those people recommend, and will continue to recommend, Microsoft because nobody ever got sacked for doing so.

      That sounds oddly like the old adage "No One Ever Gets Fired For Buying IBM," a statement which is no-longer true. I don't know about your experience, but in my experience most "normal" people ask techs for what to do. Most techs that I've met these days recommend either Mac or Ubuntu (and have a sly comment about "

    • > Major purchasing decisions are not taken by people live with their parents in Wyoming [penny-arcade.com]. They are taken by grown ups who have mortgages and orthodentist bills to pay, and those people recommend, and will continue to recommend, Microsoft because nobody ever got sacked for doing so.

      I take it you have never heard of: IBM, SAP, Oracle, or Sun Microsystems. You may be surprised to learn that, to many people who are serious experts in enterprise level system, it's microsoft that's the joke.

      Y
  • So? (Score:2, Funny)

    by endeavour31 (640795)
    Motley Fool is authoritative? I have seen better reasoning from crackheads.
  • by je ne sais quoi (987177) on Friday January 25, 2008 @11:34AM (#22181816)
    I read the bull and bear arguments, whatever, they're both waving their arms. The most interesting part I saw was in the bear rebuttal:

    MS Cash and Short-Term Investments
    6/30/04 $60.6 billion
    6/30/05 $37.8 billion
    6/30/06 $31.1 billion
    6/30/07 $21.1 billion
    Notice a trend? It would seem that MS' me-too policy (Xbox, Zune, live search, etc.) over the last couple of years has been pretty hard on their cash reserves. I think if they can turn a profit on these things it will have been worth it because $60 billion of cash reserves sounds like too much.... but if that trend continues, we'll see MS in debt by the time the coming recession is over.
  • Meh (Score:4, Insightful)

    by Colin Smith (2679) on Friday January 25, 2008 @11:37AM (#22181842)
    It's not about the money. Want to make more? Just run the printing presses faster. Money hasn't been reliable enough to be used as a measure of performance for nearly a decade now.

    Really it's about influence, and that's what Microsoft are losing, have been for several years.

     
    • For-profit companies don't exist to create "influence", they exist to turn a profit. That means money. Now, influence is a means to make money, but if you have all the influence in the world but no money, you have failed as a company. (Conversely, if you have all the money in the world but no influence, you win!)
  • by petes_PoV (912422) on Friday January 25, 2008 @11:37AM (#22181844)
    tucked away on the right side of the motley fool page, was a little link about MS. When you followit you read:

    "Stocks rose sharply for a third straight session Friday as investors cheered upbeat profit reports from big names like Microsoft Corp. and were reassured by word of a possible buyout of a trouble bond insurer."

    and

    "Microsoft's bright forecast and earnings that outpaced expectations lent strength to a notion emerging in recent days that perhaps Wall Street had been too pessimistic in its reading of the economy."

    So the Fool can say what it likes - it's always a good story to bash M$, but the people who know and who put their money on the line reckon they're wrong. Hell, I wish I had "only" $20Bn in the bank

  • by hey (83763) on Friday January 25, 2008 @11:38AM (#22181850) Journal
    Maybe Bill Gate's smartest move was knowing when to leave.
  • For an enormous company, growing revenue 15% is no small feat.

    More importantly, the author shows his breathtaking stupidity by discussing MSFT's cash position - he points to 6/30/04, which was before MSFT's one time $3/share special dividend announced summer of 04. Currently MSFT has over 9.3 billion shares outstanding - that special dividend was a 27 billion cash outlay if we guesstimate that there were 9bill outstanding in 04.

    MSFT bought acquantive for 5.9 billion, and yet their recent 10q shows around 20
  • by Simon Brooke (45012) <stillyet@googlemail.com> on Friday January 25, 2008 @11:42AM (#22181904) Homepage Journal

    OK, I'm old enough to have been in this industry when IBM were as dominant as Microsoft are now. We didn't see them start to slide, either. We were only aware that IBM were falling when their decline was already well advanced and unstoppable. I think we're in that position with Microsoft now. Why?

    We're heading for a recession. The rebuttal to the FA says:

    Sure -- Microsoft's dependence on its Office and Windows products makes it vulnerable to a slowdown in business spending. Then again, GE's power turbine and aircraft engine businesses are vulnerable, too. When the economy turns south, virtually every company is affected in one way or another.

    That's true, of course. But GE's customers can't download an open source aircraft engine for free. Also, and significantly, aircraft engines wear out. If the airlines want to keep flying at all, they have to continue to buy spare parts, sub-assemblies, refurbished engines and, from time to time, new engines. No matter how tight the economy gets, unless all GE's customers go belly up, they will have to continue to buy parts - and GE can at least hope to get some of that business.

    As the economy tightens up, one of the things that happens is people start looking at where they can save some money. Software does not wear out. Software carries on working just as well as it did when it was new, until the hardware platform which supports it wears out. And even then, it can usually be transferred to a new hardware platform. So as the economy tightens up, people simply stop buying new software. Where's the need to upgrade, when the software you have works acceptably well?

    There are fewer reasons to buy software in a recession, anyway. The total number of seats is not increasing - most companies will be laying off staff. And hardware upgrades which had been planned will be put off, so there will be no need to buy software for new hardware...

    And if people have to get new software for one reason or another, for every significant profitable product in Microsoft's inventory, there's a free alternative. Not 'cheap', free. Usually, of as high quality as the Microsoft product or higher. Increasingly, as easy to use as the Microsoft product. The tighter the economy gets, the harder it becomes to justify choosing 'expensive' over 'free'. Furthermore, unlike GE's competitors, Microsoft's free competitors are not subject to the normal rules of the financial market. they can't go bankrupt. The recession will not hurt them much - it is more likely to help them.

    I won't hide the fact that I think it's bad for this industry to have one dominant player, be that IBM, Microsoft or Google. I didn't mourn IBM's fall and I shan't mourn Microsoft's. But I don't think you can any longer pretend it isn't happening.

    • It sounds like you're as old as me :-)

      Software does not wear out. Software carries on working just as well as it did when it was new, until the hardware platform which supports it wears out. And even then, it can usually be transferred to a new hardware platform. So as the economy tightens up, people simply stop buying new software. Where's the need to upgrade, when the software you have works acceptably well?

      After the dotcom bust, the hardware manufacturers had a much tougher time than the software guy

    • Re: (Score:3, Insightful)

      by jjohnson (62583)
      I won't argue with your overall analysis, but this line caught my eye:

      Software does not wear out.

      It does wear out, in several ways:

      1. The ecosystem moves on. Businesses exachange Microsoft Office documents. When people outside the company are sending you Office 2003 docs and you can't open them because you're still on Office 97, your software has worn out in crucial way.
      2. The buglist gets longer and longer. Over time, the numbers of bugs and vulnerabilities only goes up. Some of those are fixed in p
      • by jedidiah (1196) on Friday January 25, 2008 @12:44PM (#22182714) Homepage
        Nope.

        As long as you have the ability to maintain your software, it will
        never wear out. You can always train someone else to be the
        maintenance monkey. Admittedly, this only works for software where
        you have the source.

        This does NOT necessarily imply "Free Software".

        Saavy companies get the source to important applications so they
        can maintain those systems if necessary. Software like that can
        (and has) last longer than most of us here have been alive.

        Also, the world (or technology) isn't as dynamic as a lot of people would like to think.
  • The Wii is scooping up mostly casual gamers. These are the sort of people who will buy up a lot of $20-$30 games, but won't be buying a lot of the more "hardcore" games like Halo, Gears of War, Metal Gear Solid, Final Fantasy, Mass Effect, Devil May Cry, etc. It's almost two separate markets.

    One of the things I'm curious about here is that a lot of the people buying the Wii are not in the audience that is likely to buy many games, like the elderly. I wonder how many of the people who've bought the console w
  • Makes sense. (Score:2, Informative)

    by MacarooMac (1222684)
    So the reason why corporate uptake for M$ Vista has been relatively slow is because.. ...most corporations just lurrrve M$ XP!

    Guess M$ will have to dip into that $20 billion cash flow reserve of theirs and 'ride this one out' ...untill they release W7, which those corporations who skipped Vista will almost certainly adopt much earlier.

    Oh! I completely forgot: Apple Smuck and Linux OSS** are coming with a vengence.. to a t.v. advert near you.

    **Please note that I dual-boot Vista and Kubuntu, though none o
  • Microsoft products are like Lego's. You don't always get the pieces you want in a set, but they plug together nicely, and can be centrally managed through Active Directory (very robustly, I might add).

    Everybody out there always criticizes Microsoft when they find another company (the flavor of the year) who has a better Lego piece, or two, than Microsoft. It's touted as the best invention ever, and promoted as the downfall of Microsoft.

    But as it turns out, it's not a Lego piece at all. It's a K'Nex piece
    • Re: (Score:3, Insightful)

      by guruevi (827432)
      I would say that about Unix-based systems and software. Don't even dare to say that about Microsoft, Microsoft is more like the fake lego blocks that have been around. They look like they fit the standards but when you actually go to connect them, they don't align properly. Sure if you go and buy all kinds of fake lego blocks then they might work FOR YOU but as soon as you go play with another kid it doesn't fit right.

      Unix-based systems (Linux, Unix, Mac OS X) are like Lego blocks and Lego Technics (I don't
  • It may not have interesting products, but its making plenty of money.
  • Risk and return (Score:3, Insightful)

    by gilesjuk (604902) <`ku.oc.nez' `ta' `senoj.selig'> on Friday January 25, 2008 @12:27PM (#22182470)
    What the Fool is pointing out that Microsoft is a risky investment where the returns are poor.

    If you buy shares you want as low risk as possible and decent returns (10-15% is average, somewhere between a low risk and high risk investment).

    Microsoft is risky simply because there's so much uncertainty over Xbox 360 warranty claims, poor Vista sales and yet another EU court case.

  • by QX-Mat (460729) on Friday January 25, 2008 @12:43PM (#22182710)
    Excuse me for being a bit sceptical, but the XBox 360 is doing fantastically well, they have a market and the right games for that market... New PCs are still being shipped with MS products and MS office is entrenched into modern information systems decision making.

    You have to remember that MS can afford to fix faulty XBoxes, so it ultimately becomes a moot point.

    All this on a very good quarter...

    I think The Motley Fool just wants good slashdot traffic myself.
  • by Maudib (223520) on Friday January 25, 2008 @01:24PM (#22183394)
    The article cites future revenue growth of 10%-15% a year as evidence of MSFTs decline. Huh? Most companies would kill for that sort of growth.

    Moderate the article -1 Troll please.
  • by prisoner-of-enigma (535770) on Friday January 25, 2008 @02:22PM (#22184424) Homepage
    Now that's funny, because I recall reading just a few days ago that Microsoft is stating the highest ever profits (or is it revenues?) for its last quarter. And the MS games division announced it's profitable now as well after running for a loss for years.

    Vista is a big stumble for MS, no doubt about it. But to say this is the beginning of the end? That's a stretch.

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