A number of years ago I wrote a blog post about the possibility of Microsoft turning into the ‘old’ IBM. Now it seems there are other similarities, but another company looks to be doing the same thing. Looking back at what I wrote in 2007, a few points now seem strangely familiar.
- reliance on a monopoly cash-cow; IBM with mainframe hardware and operating systems, Microsoft with Windows and Office
- branching out into all sorts of different systems and applications; being good in some areas and terrible in others, but still continued in the terrible areas
- being a symbol of conventionality; Microsoft is now even old-fashioned to the millennial crowd
- thinking that they might take over the world; in their heyday there were concerns that they might get too much influence, how quickly that fear can change
Nearly eight years later I think the points I made above confirm Microsoft has become like IBM, even as far as experiencing a downturn in business as new competitors and business models emerge.
Something else though has appeared that makes them similar to my mind – a knight in shining armour coming to the rescue. In the IBM story it was Lou Gerstner who saved IBM from a serious predicament. For Microsoft, it’s new CEO Satya Nadella’s change of business model. Nadella has introduced a number of initiatives which indicate a significant change in attitude, a recent one being the acquisition of email app Accompli; who would have thought that Microsoft would support other email platforms.
There’s another vendor whose business model has changed from what it set out originally, Oracle. Starting out purely in the enterprise software arena, in the last few years the number of acquisitions and the broadening of focus make it look like another IBM. But in this case, it’s because Oracle wants to own the whole stack. In comparing Digital Equipment Corp and Oracle, I commented in 2009:
There was a belief about Digital that it became too difficult to manage so many different technologies, and that contributed to the company’s demise. So I can’t help wondering how Oracle will manage.
Oracle seems to be doing OK. So far. Although Larry Ellison stepped down as CEO earlier this year, I bet he is still in control. The test will come when he leaves the company completely.
So perhaps it will have to wait another seven years before I can write again about how tech companies become like IBM.
Update: Gartner’s Merv Adrian published a quadrant-style picture that shows where Microsoft products are on the Gartner Magic Quadrant. Look at the range of products, and those that are not in the leader quadrant.