Microsoft, a recipe for success

As most of you may have noticed, I am not exactly a genius (or is ‘geek’ the word?) when it comes to information systems... so, when asked to talk about Microsoft, and in particular at what point Microsoft is today, I am inevitably forced to open my laptop to do some research. I realise two things right away: looking at my screen I realise that Microsoft Windows is the only OS I have ever used and that most of my friends see it as the devil... as they are obviously Apple and Mac fans!
Thus I have decided to dig a little bit to understand the reasons behind Microsoft’s success and find out where Bill Gates’ company stands today.

What does Microsoft do?

Microsoft is a company founded in 1975 which operates in the computer software, consumer electronics and video games consoles. It principally makes (very successful!) software that is a household name to anybody that owns a computer. The best known examples are the Microsoft Windows operating system - the latest version called Windows 7 was launched in July 2009 and has now installed in more than 12% of operating systems installed worldwide - and the Microsoft Office suite, which includes the well-known Word, Excel and Powerpoint programmes. Additionally, Microsoft also seems to be a player in the software market for businesses (“client and server” market) and has a portfolio of products for servers and business software and applications.
Then there is also the Internet stuff that Microsoft does: the Internet Explorer for web browsing, the search engine Bing (launched in 2009, and also used to power the searches of Yahoo!) , the Windows Live services (Hotmail, MSN messenger, photos, images, news, etc) and the Zune entertainment platform for things like music and video software.
In recent years, Microsoft has also entered new markets such as the videogames, with its Xbox and Xbox-360 products, and the smartphone market with its Windows Phone product range.
In conclusion, Microsoft seems to be a big player in a number of information systems markets, although not with the same success everywhere…

Where does Microsoft make its money?

The revenues of Microsoft in 2009 were $58.437 billion , 3% below the 2008 figure of $60,420 billion, and its operating income was down 9% to $20,363 billion.
Microsoft dominance in the software (like Office) and client server business (see figures 1 and 2) makes 81% of revenues and in 2009:

Figure 1:



















Figure 2:












However, the Internet services results were not very positive in 2009 (about 5% revenues in 2009 but a growing operating loss of $2 billion).

Who are the main competitors of Microsoft?

Being in different sectors Microsoft has wide variety of competitors, the principal ones being the following:











What next for Microsoft?

It seems Microsoft will continue leading its core market of operating systems in the near future, but:
1. Does Microsoft dominance of software and operating systems give it a unique competitive advantage for the future?
2. As information systems markets converge, will the value move from markets Microsoft is in and what can it do about this?
3. How will Microsoft do in other markets against companies like Apple and Google that seem to be more popular and with stronger and more attractive brands?

TBC....



Source
http://www.netmarketshare.com/operating-system-market-share.aspx?qprid=8
http://gs.statcounter.com/#os-ww-monthly-201004-201004-bar
http://news.bbc.co.uk/2/hi/business/8174763.stm
See Microsoft.com