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Sanjeev Sharma's  Instablog

A few years back in New Jersey, while working in his backyard, Sanjeev came across a strange looking ball ( the picture is attached here ). The ball flashes lights and predicts macro events, sporadically. Sanjeev uses the ball to write articles on Seekingalpha, and tries to give logic and data... More
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  • Why I would sell microsoft ? 4 comments
    Oct 20, 2009 02:47 PM | about stocks: MSFT
    Unlike IBM (which I recommended as buy in June in my stocktalk and which offers a large and complex set of products), the products offered by Microsoft are few and simple to understand.


    For a long time, Microsoft's operating system was the de-facto standard in Personal computers.

    Along with the MS Office products, it was the main choice for the consumers.

    The MS Office's most popular software are the Wordprocessor, spreadsheet and the presentation software.

    Most users hardly need any other MS software besides the Office and browser.

    MS's online presence and the remaining products (like X-box) contribute marginally towards the topline.

    One strategy of Microsoft was to come up with new versions of these products which were incompatible with previous versions.

    This forced users to purchase the new versions if they wanted to read the documents sent by another user using the newer verison
    of these softwares.

    However, all this could change in the next few years (or earlier).

    Recent advances in open source software have created strong alternatives.

    Ubuntu, a linux based operating system is now available with a GUI which gives the same look and feel as MS Windows.

    Most of windows's shortcuts are available on it and users can hardly find much difference in experience from windows.

    Ubuntu comes with OpenOffice based products which allow the users to read, edit or create new documents which are compatible with MS.

    In other words, the OpenOffice based wordprocessing software, spreadsheet software and presentation software can not only read and edit MS based documents, but also can create new documents in the format of MS.

    A user using MS would never know that the document was created using Ubuntu.

    All this software is free and the software keeps itself updated free of cost from internet. Further, most viruses cannot affect Ubuntu as it is based on Linux.

    While the later versions of MS office products are not readable on the earlier versions, all of these are readable on the Ubuntu's platform.

    Many price conscious companies  have started using Ubuntu now.
     
    Out of the total $58 billion revenues of microsoft, $14 Billion comes from PC based software (mostly Windows operating system) and $18 Billion
    comes from 'business division' (most of it from MS Office). The server based products give $14 billion which is mostly from
    the Windows server and SQL Server (again based on Windows operating system).

    Except the entertainment division (with XBox etc) which barely give $8 billion of revenues, Microsoft sales are based on the dominance of Windows and MS Office.

    The advances made by open source software has made the dominance of Windows under the most serious threat in the last 2 decades.



    Themes: Software, Stocks Stocks: MSFT
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This post has 4 comments:

  •  
    Great read!
    Nov 01 12:57 PM | Link | Reply
  •  
    Interesting stuff but I'm not sure this one factor warrants a "sell." What about other moves they've made like extending their software to Apple computers? Plus Bing has made some real inroads and their new partnership with Yahoo holds pontential. A long way to go against Google but its a nice start. Thanks for the article.
    Nov 01 04:28 PM | Link | Reply
  •  
    Is it correct that office can't read newer versions? I have Word '97 (.doc) and when I received a Word 2007 document (.docx), it couldn't open it but it asked if I wanted to download a "compatibility pack" to read it. In the end I didn't bother - I have gmail so I opened it as a google doc since gmail could read a .docx. This wasn't always the case so must be a recent enhancement on google's part. If you are correct though, it is interesting how this app from Google makes me less dependant on Microsoft.
    Nov 02 04:59 PM | Link | Reply
  •  
    Bing and other products of microsoft are not 'leaders' in their segments.

    They are supplemental to the main Windows and Office products which had become standards and indispensable.
    Nov 06 06:16 AM | Link | Reply
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