Comment Just a general comment (Score 1) 1643
Based on the comments I've read in response to this post I have gathered up several generalizations about this group:
1. You've never owned your own business
2. You've never taken a class on business or competitive business practices
3. You believe competition is standing by and letting your friendly competitor take away your market share.
In a competitive capitalistic business environment your goal is to constantly increase your profits. Because of inflation, just maintaining regular customers will achieve this goal however this is not enough. Businesses always want to grow infinitely and so they will strategically accumulate resources (be it money, securities, other businesses, raw material sources) to make this infinite growth possible. If I own a plumbing outfit that is growing rather large in size, I may one day decide to buy out a local plumbing supply warehouse. This guarantees me lower prices on the parts used for installation thus I can charge the same price to my customers and make even more money. On top of it, I now have all the purchasing data for every competitor in my area. Does this make me an evil company? No, if anything it shows the brains behind the operation by expanding your business into relevant markets as a way to increase profits while enhancing your original outfit.
For whatever reason when Microsoft expands into relevant markets everyone gets into an uproar. Suppose you are a well-off computer application development corporation and Microsoft shows up one day offering you $500 million. The book value of your coporation (plus goodwill) is valued at around $300 million with industry average earnings. Your forecasts predict your corporation will hit a value of $500 million in a minimum of 5 years. What do you think your board of directors is going to do? They're going to sell out since you'll probably get 166% of the share value per share. For Microsoft, they can offer deals noone can refuse because they have the capital to do so. For these companies, the wisest choice is to sell the company and collect the money.
Addressing the 'quality' of products back when Microsoft & Apple were close competitors, why is it that Microsoft thrived? Gee, maybe because they targetted a market that actually had money to spend: the corporate market. Sure, Apple had easy to use products and an intuitive GUI but they went after the educational market. And on top of it corporations shied away from cutesy little boxes in favor of IBM's more mature (and boring) looking alternatives.
I'm not saying that Microsoft isn't a fun company to rag on but don't hate on them just because they're not afraid to run a business and do what it takes to be number one.
1. You've never owned your own business
2. You've never taken a class on business or competitive business practices
3. You believe competition is standing by and letting your friendly competitor take away your market share.
In a competitive capitalistic business environment your goal is to constantly increase your profits. Because of inflation, just maintaining regular customers will achieve this goal however this is not enough. Businesses always want to grow infinitely and so they will strategically accumulate resources (be it money, securities, other businesses, raw material sources) to make this infinite growth possible. If I own a plumbing outfit that is growing rather large in size, I may one day decide to buy out a local plumbing supply warehouse. This guarantees me lower prices on the parts used for installation thus I can charge the same price to my customers and make even more money. On top of it, I now have all the purchasing data for every competitor in my area. Does this make me an evil company? No, if anything it shows the brains behind the operation by expanding your business into relevant markets as a way to increase profits while enhancing your original outfit.
For whatever reason when Microsoft expands into relevant markets everyone gets into an uproar. Suppose you are a well-off computer application development corporation and Microsoft shows up one day offering you $500 million. The book value of your coporation (plus goodwill) is valued at around $300 million with industry average earnings. Your forecasts predict your corporation will hit a value of $500 million in a minimum of 5 years. What do you think your board of directors is going to do? They're going to sell out since you'll probably get 166% of the share value per share. For Microsoft, they can offer deals noone can refuse because they have the capital to do so. For these companies, the wisest choice is to sell the company and collect the money.
Addressing the 'quality' of products back when Microsoft & Apple were close competitors, why is it that Microsoft thrived? Gee, maybe because they targetted a market that actually had money to spend: the corporate market. Sure, Apple had easy to use products and an intuitive GUI but they went after the educational market. And on top of it corporations shied away from cutesy little boxes in favor of IBM's more mature (and boring) looking alternatives.
I'm not saying that Microsoft isn't a fun company to rag on but don't hate on them just because they're not afraid to run a business and do what it takes to be number one.
