In-Depth
13 Most Important Microsoft Product Lines
Microsoft is an unusual company for the sheer number of product lines that bring in more than a billion dollars. While the company doesn't break out revenues for all of its product lines, Communications Director Frank Shaw famously revealed Microsoft's billion-dollar businesses to the TechFlash news blog last year. Under those businesses, of course, are Microsoft's most important product lines.
1. Windows Microsoft's bread and butter is Windows and despite some who predict its demise, the OS is doing quite well. Microsoft revealed that it has sold 400 million copies of its latest version, Windows 7. Still, Microsoft faces challenges. PC growth is slowing and with the most drastic overhaul ever of Windows planned for Windows 8, it remains to be seen how the market responds to the product's new tile- and touch-focused UI.
2. Office Anyone who knows anything about Microsoft is aware how important its Office franchise is to the company. Microsoft has shipped 100 million copies of Office 2010 since the product's release in mid-2010. Despite a long history of stellar growth, consumer licensing of Office dropped 8 percent last year but businesses helped drive Office revenues up 27 percent during the company's 2011 fiscal year.
3. Exchange While a growing number of customers are offloading their e-mail systems to the cloud, only a small sliver of large enterprises are making the wholesale shift. Exchange remains the most widely adopted enterprise e-mail platform.
4. SharePoint While it has its share of detractors, SharePoint is a billion-plus-dollar business for Microsoft because it lets enterprises share information generated from Office and other sources.
5. SQL Server The database is a key pillar of the Microsoft Server & Tools Business. SQL Server revenues increased 20 percent in fiscal year 2011. On tap for this year is SQL Server 2012, code-named "Denali," which will push the envelope in terms of support for business intelligence features and support for big data.
6. Windows Server As long as Microsoft is selling lots of SQL Server, Exchange Server, SharePoint and Dynamics, customers need Windows Server. Besides that, of course, Windows Server provides enterprises with their core authentication services through Active Directory and virtualization via Hyper-V, as well as providing the infrastructure for products such as IIS and Windows Storage Server.
7. Visual Studio The latest release, Visual Studio 2010, has enabled thousands of developers to target Microsoft's latest platforms, including Windows 7, Windows Azure, and Windows Phone 7, as well as the forthcoming Windows 8. "Visual Studio 11" is now in the works.
8. Xbox At last count, Microsoft reported 35 million members of its Xbox Live community. In fiscal year 2011, Microsoft sold 13.7 million Xbox consoles, compared with 10.3 million in 2010. Revenues for the company's Entertainment and Devices Division hit $2.7 billion, a 48 percent year-over-year increase.
9. Bing It will be a long time, if ever, before Microsoft's search engine can unseat Google as the default search engine of choice. But thanks to Microsoft's partnership with Yahoo!, Bing has grabbed a 14 percent share of the search market, up 31 percent over FY 2010. Still, Bing and the rest of Microsoft's advertising and online business continue to lose money to the tune of $2.5 billion, based on revenues of the same amount.
10. Dynamics Microsoft's portfolio of ERP and CRM software and services is believed to generate more than $1 billion in revenue. While Microsoft is in the process of updating the entire portfolio with cloud and social networking features, the company faces a barrage of rivals in this cutthroat market.
11. System Center Believe it or not, the Microsoft System Center product line also brings in more than $1 billion in annual revenue. Used to manage both hardware and software running in enterprise datacenters, Microsoft just gave the management suite a major refresh. Due out in the first half of this year is System Center 2012, which will add new capabilities to operations and applications management.
12. Skype The newest addition to the Microsoft portfolio, Skype grossed $860 million in 2010, according to its IPO filing, before the company was snapped up. Between the unified communications business of Lync and Skype, Microsoft says it intends to increase the availability of real-time voice and video communications to consumers and enterprises.
13. Windows Azure This is the only product line on the list that probably isn't even close to generating a billion dollars in revenue. Nevertheless, the Windows Azure platform is clearly an important product line as Microsoft customers and partners transition their systems and apps to the cloud. Its success or failure will have huge implications for Microsoft.