Barney's Rubble

Glutton for Market Share

There seems to be no end to Microsoft's appetite for acquisitions and new markets.

This column, if you strip out the specifics, could've been written anytime in the last 20 years. But writing it now is more relevant than ever for we are truly at a danger point.

The problem? Microsoft wants it all. If there's a dime to be made, Redmond wants the whole 10 cents. In categories it invents (think hard to remember the last one, maybe Flight Simulator?) that's fine. Create a new category, build a brilliant product, and reap the rewards. That's the American way.

In the early days Microsoft went after large, entrenched companies like Lotus, which at one time was far bigger than Microsoft. Sure, Microsoft leveraged its desktop monopoly, but in the end Lotus was simply outsmarted -- as was IBM -- a company whose tab for two-martini lunches used to exceed Redmond's yearly income.

I could live with this, and, in fact, enjoyed watching these giants get knocked around.

But with the big guns defeated, Microsoft is turning to smaller players, and now nearly every third party is in the Redmond cross hairs.

Here's the latest hit list:

  • Anti-virus and Security Software -- McAfee, Symantec and Sunbelt were not just good partners, they saved Microsoft by making Windows usable. Now that Microsoft has figured out how to make the same software, these companies are suddenly the enemy.
  • Management software -- when Windows NT first shipped, it was a bit rough around the edges. Fortunately, systems management companies were there to smooth it all out. Now that MOM and other tools are mature, Redmond no longer needs this help. See ya!
  • Unified Communications/Messaging -- Microsoft plans to go after Cisco, Avaya and all the rest -- the same companies that taught Microsoft how it all works in the first place.
Yummy!

Walk any Microsoft show, Tech-Ed or the yearly Partner conference, and you'll see aisle after aisle of niche companies. Important indeed, but not exactly designed to go toe to toe with Big M. And many of these niche companies are next on the list.

Microsoft should not kill off or even marginalize third parties. It's bad for innovation, bad for business, bad for the magazines and Web sites that rely upon these companies for advertising (and give you great, free content as a result, and I'm not just talking about this mag you've got in your hot little hands).

What should you do? Don't blindly buy bigger and bigger Microsoft stacks. Just because it's integrated doesn't mean it's best in the long run. Remember, the chief advantage of any monopoly is price control.

Support third parties. Don't let Microsoft have it all, or you'll have to live with it when they do.

About the Author

Doug Barney is editor in chief of Redmond magazine and the VP, editorial director of Redmond Media Group.

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Reader Comments:

Fri, Oct 13, 2006 Dan Iowa

Well I'll weigh in here even if a little late.
We all have choices. If you don't want to upgrade, don't. If you want to pay for what Microsoft is providing, do it. If your company buys Microsoft and you can't live with it, show them why it's to their benefit to switch or find a new company to work for.
Other companies are free to market to Windows products or to market to other OSs. It's their choice.
We should all just accept the choices we make and stop blaming others for our choices. We should also stop worrying about the things we don't control, and that primarily includes the choices that others have already made.
All of that said, if we really want to stop monopolies, we should start dealing with the laws that govern everyone. If you just focus on one company, the next one will be their to take its place. Perhaps we need to limit how large a market any one company can serve. On the other hand, do we want to deny access to certain products to make sure no company get's too big?
Maybe we should just set laws that regulate the agreements companies can make between each other. But then that would be government interference wouldn't it?

Sat, Sep 30, 2006 Keith Ward Maryland

Hiya Doug!

Well, you sure got 'em talking. It's a thorny problem, to be sure. One difficulty with Microsoft's feature creep is that it's easy to settle for a less-than-best-of-breed utility that's bundled with the OS, rather than pay for an admittedly superior product. At least it is in my world, and I'm a huge fan of competition for Microsoft. Re: Vista -- I think it will be an enormous challenge for Microsoft to sell this to businesses and consumers, since XP works well, as does Server 2003. I have no plans to upgrade, and I wonder how many others will. Can you think of a killer app? Me neither.

Fri, Sep 15, 2006 chuckster texas

Microsoft makes this software in India and it is still expensive and not secure. Let's face they buy off our political leaders to look the other way. MS has not made a product worth using since windows 2000 and windows 3.1

Thu, Sep 14, 2006 Nick Anonymous

I personally LIKE the 800 lb amoeba that MS has become. Eat the small fry, incorporate the best of them, move on. I LIKE integration. It means that everything has been tested as a package and WORKS as a package. Ever been in an environment where Netware, Oracle and Lotus Notes all had to play nice together on NT-2000-XP desktops? Nightmare! Active Directory, SQL Server and Exchange? Sweet! Have you ever had PDF nightmares? 15 or 20 packages to choose from - Adobe Acrobat, best but most expensive, down to freeware. None of them with good documentation, all of them looking for 'support contracts' , proprietary hidden knowledge bases... YUCK!
MS was going to add direct-within-office PDF creation. HOORAY. MS Access reports--save as pdf--automate emailing via VBA. HIP HIP HOORAY! At long last!! We've wait for so damned long for that functionality...and then Adobe whined...you're killing us...it's anti-competitive...you should make it separate...and CHARGE as MUCH as we do for ACROBAT. Hell no! I WANT an OS that has the best-of-breed built in for EVERYTHING--because supporting all these third-party things is a pain, and paying for them COSTS a fortune

Thu, Sep 14, 2006 Jeremiah US

I think Apple is starting to do the same thing. They are trying to integrate everything into there OS and products so that third parties don't even have a chance.

Wed, Sep 13, 2006 Brogahn Canda

MS and their polices have given the corporate world what they wanted, the corporations bought the crappy software and suffered with it. Now here we are a few years later bitching because a company has done whatever it could to gain marketshare, and make more money. WAKE UP! Every product out there has flaws, and most software is buggy as hell, regardless of who makes it. The difference is MS have a higher install base. Is that MS's fault that everyone bought their products? Did MS MAKE you buy windows? They bundled their software with the the pc's, isn't that a great idea? Did MS make you stop buying UNIX servers and Novell Netware, or Wordperfect or Lotus SmartSuite? The Corporate world has made it's bed, now it needs to lie in it. TFB.

Wed, Sep 13, 2006 Nicolas Paraguay

First of all it would be nice that if someone states his/her opinion at least they leave a name so that someone can write the sh*t out of the crappy commnet. I think Doug is right, ask bill gates if he thinks the world would be better off if everybody used windows, he'll say "sure". Bottom line is that if it was up to him we all wouldn't have a choice. Someone wrote about security flaws in unix and mac, typical, give us a break or an informed opinion, like you ever experienced a user taking control over your unix/mac or your system and files render useless by virii in either of them. Sh*t one has to be dumb to actually pay more so that the people that already sold you a buggy OS, can then sell u a patch for it. Being a computer programmer and working with computers for everyday life my worst experiences have been with Microsoft, unsecure/unstable/unreliable/buggy os ...period. As for vista, he is quite right, why would you buy a ridiculously resource hungry os, for the looks??? please... read around, i've got XGL and COMPIZ running on my laptop with Ubuntu and it looks and feels soooo much better than ANY beta/rc i've of vista i used (not to mention there's not a single good review about it anywere). Thanks to Novell, the Linux desktop (at least as far as eye-candy is concerned... and so many people just want nothing else) has gotten ahead of the curve, point is not many people found out, but i did and i'm happy to spread the news

Wed, Sep 13, 2006 Michael Butterworth UK

I've tried MS AntiSpam/Defender and did not get on with it, however I read an article about Enterprise Anti-Spam and the best of bread was SunBelt's CounterSpy. Having discussed the product with Sunbelt they explained that is came from the same source company as Microsoft's offering. We use it and it is great. As the french say 'viva la differance'

Wed, Sep 13, 2006 Anonymous Anonymous

Ok, let me get this straight. Journalists and bloggers are saying Vista is not worth the upgrade because it doesn’t have many features beyond XP. But these same people have damned MS for including new features in XP and Vista. And these rules don’t apply for other companies like Apple. Seems like grass-roots communism still alive and well even in American hearts.

Wed, Sep 13, 2006 Anonymous Anonymous

The vocal ones seem to like negative sensationalism when it comes to Microsoft. Double standards too. So in Apple ads they highlight all of the bundled features and products with Macintosh and compare that to Windows. Then you have the vocal journalists and bloggers who keep screaming that it's unfair for Microsoft to include anything in Windows that someone has already written. Apple didn't invent most of the bundled applications either, Linux is finally becoming a blip on the radar because it bundles everything immaginable with it's distributions, and that's OK. But, MS is bad for including more than wordpad and browser. Recall the DOS days when you buy and OS and all you could do is EDLIN. From a business and consumer perspective, I like stuff that I need included in the OS. I don't think I should have to buy a $60 program to remove red-eye from my photos. MS SHOULD fix virus and spyware and include these utilities with the OS. If I perfer to use Symantec, McAfee or others I should be able to do that. Symantec - you don't do a good job at all with your product and it is over priced, buggy and slow. What if we held the same demands to car companies? Air conditioners, power windows, car alarms and anti-corrosion protection should be prohibited from new GM cars because 3rd parties can produce these aftermarket add-ons? Or GM can't include these features because other car companies may have had them first? I'll go along with the sensationalist thoughts if the same rules apply for Apple and Linux, but by singling out Microsoft, you and the foreign countries that are erecting barriers to Microsoft are even worse in your beliefs than Microsoft ever was.

Tue, Sep 12, 2006 Anonymous Anonymous

Microsoft is now bent on destroying the very "ecosystem" they used to defend their breakup. I always thought that argument was specious, but it evidently worked for them. I wonder if they intend to cannibalize the Windows market because they are being stymied on the Open Source front.

Mon, Sep 11, 2006 Bill SW Florida

MS is a shining star of free enterprise. I applaud Bill G. for his business acumen. On the other hand I despise the callous disregard for security that by and large is responsible for the state of the internet today: roughly the equivalent of the 'baddest' ghetto in the world. Of course business and profits will generally cloud sound moral judgement and judgement that is to sufficiently errant will eventually bite one's butt. Those who blindly embrace MS and all it has to offer, are going to suffer when the worst possible scenario unfolds. Who knows the dark secrets lying within Vista. Well, the dark elements of our society are going to find them. And who knows what other calculated, insidious stuff is locked away in there, destined for the highest bidder or the most powerful forces?

Mon, Sep 11, 2006 Rick Colorado

Security tools such as virus blockers should be included in the OS without extra costs. Companies like McAfee and Norton have morhed into gouging models themselves and exist only because of OS deficiencies.

As for the rest, let the market control. If it's a needful utility and MS deems to want to include it, fine. Any company must continue to improve, add product, and grow or it will cease to exist. Software is no different than any other market.

As a side-note. I remember playing Microsoft Flight Simulator on a TRS 80, long before the PC.

Mon, Sep 11, 2006 Anonymous Anonymous

Poppycock! This is the same "Chicken Little" journalism we've been hearing for over 20 years. It's popular to bash Microsoft for being a successful company. Why should they reinvent the wheel? If a company is willing to sell their products (e.g., Winternals, Softricity, etc.) why shouldn't Microsoft or any other company with the capital buy them? By the same token, when Microsoft bundles one of these products with another it is usually a "light" version. Therefore, we still use those third party companies in a corporate environment such as Diskeeper, Citrix, Symantec, CounterSpy, etc. As far as security is concerned, there are more vulnerabilities in all flavors of UNIX and Linux than in Microsoft products, while Apple, Novell and others don't have the market share to make those products "interesting" enough for hackers to bother with. As the latest version of Macintosh gains in popularity, there has been a corresponding gain in detected vulnerabilities. So indeed, compare Apples with Apples. Folks, the sky is not falling. Keep making informed choices based on business needs and business will continue as it always has.

Sun, Sep 10, 2006 Anonymous Anonymous

Don't forget Citrix. They developed both the multi-user version of Windows (v3.51) and the protocol (ICA) to transfer screen images etc between servers and clients, and called it WinFrame. Microsoft forced Citrix to license it all back to them when NT 4 came out, otherwise they'd have taken their entire core business away by developing their own "free" version. Then MS developed Terminal Services and RDP (both largely based on Citrix's work) and successfully shrank Citrix's marketplace so that they are now just another add-on vendor. That seems to be MS's ultra-successful business strategy - take other vendors' markets away from them, and sew it all up so they're reduced to bit players (allow them just enough room to "value add" a few things high-end users need). Diskkeeper is another example, hovering around the edge - MS keep adding bits of their disk management functionality to each new OS release, but never quite take it all away. So Diskkeeper survive on ever narrower margins and competition is forever reduced. In the end, I don't think this sort of thing is good for most users.

Sun, Sep 10, 2006 Scott Anonymous

The end result in all of this is that Microsoft's software is becoming way too expensive due to the added costs of stuff that may or may not be wanted or needed. Vista's Ultimate version is weighing in at $400!!! And it doesn't get too much cheaper for lesser versions when bought new. In Office software, MS Office will run you as much as $500, while one of it's hardest competitors' version is, well, free in the version of Open Office.

Personally I believe the core OS should be free or pretty close to free (I don't believe in killing the retail chains). If MS want's to create pretty desktops, collaboration tools, antivirus stuff, then charge for it. Let them make their money honestly by providing tools that are wanted rather than forced on the public in "must have to even work so you must buy it" stuff.

BTW, Flight Simulator was "purchased" by MS, not "made". Minor point, but still notable.

Sat, Sep 9, 2006 Clinton Gallagher Milwaukee County, WI - USA

Autodesk has secured a monopoly in markets that require vector graphics. The National Institute for Science and Technology(NIST) reports the U.S. construction industry operates at a $15 billion annual loss (and rising) because the participants are under-trained and the software available to them has been crippled. Autodesk crippleware subverts, obstructs, hinders and in fact prevents architects, engineers, manufacturers, drafters and others who depend on using vector graphics to draw and record their products and services from operating efficiently.

In fact, it can also be proven that Autodesk crippleware is significantly responsible for causing building failures and loss of life resulting from building failures because the corporate parasites that control Autodesk not only cripple the software products they control a proprietary vector graphics file format that is itself crippled and changed yearly or more often to subvert, obstruct, hinder and prevent 3rd party development of software products or processes which support collaboration, coordination, organization, reporting, management and whatever other business process development that can be legitimately conducted and managed using the benefits of information technology.

Finally, Autodesk cripples the product and the file formats to prevent them from being used with the Internet, notably the web in any manner other than which this dictate. Let's give them their due, Autodesk develops outrageously useful drafting software features but has in fact become a parasite that is responsible for huge losses of time, money, building failures, machine failures and yes, even extends to loss of life.

When is this parasitic company of corporate cockroaches going to be exposed to the light of day?

Sat, Sep 9, 2006 Anonymous Anonymous

I agree with the editor, Doug, that it has been a long time since Microsoft had an original idea or product. SQL Server technology came from a deal with Sybase, MS Access was improved and made to be what it is today after MS bought Fox Software (FoxBase, FoxPro) and I'm sure the same tactics apply to numerous other applications as well.
In my little world we run MS, Linux and Unix Servers as well as Mac and Windows desktop machines. I don't intend on giving MS the whole pie because 1) they haven't earned ALL my business, 2) they can't support it well enough (without a $245 phone call and 3) they can't protect it. As an administrator the majority of my day is dealing with Windows issues. The other OS's cause very little problems and I continuallly wonder why we're content to spend an enormous amount of time, energy and money on a product that isn't even the best in the market and one that is playing catch up now. Even with the release of Vista, I don't see anything new that hasn't already been released elsewhere.

Fri, Sep 8, 2006 Robert B San Antonio, TX

Robert Bugtel, San Antonio, TX, bugtel1@satx.rr.com

Microsoft has been knocking off third-party developers since the DOS days. Think back to all those little utilities that made life easier, and then the next version of MS-DOS incorporated them. No more little utilities. Microsoft has made a career of copying other's ideas and putting them out of business.

Fri, Sep 8, 2006 Kemperflow Anonymous

Number one, they shouldn't develop virus blockers and spam blockers and charge for them, they need to work to remove the vulnerabilities in the product, not capitalize on them by charging for another product.

Number two, when you have an 5000 pound gorilla, minting money and bullying the small businesses out of their share, how does the little guy really have a chance? I've known way too many of my friends, who were at cutting edge companies with great technologies, that got stomped by Microsoft through MS bullying the OEM's to not install their software, through other channel pressures, or by simply developing the technology themselves (albeit not as good), but unfortunately the american public seems to go more for FREE than for paying to get incremental features.

If you want to give the little guys a chance, stick with Windows XP & XP Pro. Don't go to Vista. Don't buy it, don't give them money. Realistically it won't do much more than XP does for you today.. Show them we don't have to spend $300 everytime they come out with a new version two years late. I'd say go open source, but that just isn't realistic.. so instead, I say stay where you are.

And by the way.. The U.S. market is FAR from a free market (maybe Hong Kong fits that bill). Check out wikipedia to read up on a free market economy. Our market is not free, it is affected by government and political influence, and if you don't think Microsoft is another political force that creates barriers of entry for small companies than you truly have no perspective on the market. MS may not be changing the constitution, but you better believe they change licensing strategies with the OEM's to force out the little guys. What's the difference? Those contracts are pretty much laws that HP, Dell, Acer, Micron, etc, have to follow if they want to ship the Microsoft OS, which has yet to be rivaled for consumer acceptance. It will take another paradigm shift in computing to knock them off their throne.. Google is trying hard, god bless'em, but look how big Google had to get to start wrestling with them..

Fri, Sep 8, 2006 Anonymous Anonymous

Microsoft has every right to build competing services, or buy competing companies, or go into any market it wants. Many smaller companies, their directors, and stockholders have been enriched as partners or acquisitions. Indeed, many are formed with the specific intent to sell themselves to MS or the highest bidder. While I won't blindly buy Microsoft products because they are large, I enjoy the integration improvements that are implemented over time; they make the products more robust and useful. Where MS isn't as fully featured, I go elsewhere. As Mr. Barney states, tradeshows are packed with smaller niche companies that are focused on innovation - seems to me now more than ever. Personally I like the combination of large companies who have the wherewithal to develop large software frameworks AND the smaller companies trying to be the next big company. This is what makes the free market system work.

Fri, Sep 8, 2006 Anonymous Anonymous

I agree Mr. Barney's opinions, but the example given are terrible. The first two (security and management consoles), are clearly deficiencies in the operating system and are, in my opinion exactly what Microsoft should be going after. What about game consoles, music downloads, video downloads, search, browsers, reporting, OLAP, ERP applications and CRM?

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