Time to say goodbye to Skype ?

LakeWashington · May 11, 2011, 10:50am

UCSDUCLADAD, aren’t you being a bit to kind to Miscrosoft when you say that they were the catalyst that brought down the cost of software in the 1990s? Sure, they were the somewhat cheaper alternative to Lotus and WordPerfect Corp. when those companies were on top of the software world, but MS major software has been very expensive since that time! I’m not intested in bashing MS. I’d just like to see them compete a bit better as the industry has changed. As far as the internet goes, they’ve always lagged behind, despite having several armies of programmers and developers and fortresses of cash.

Skyhook · May 11, 2011, 11:10am

We have iPhones and Mac computers. We use a program called Facetime, which is a videochat program (free) like Skype. It works great and you can use it on your phone or your computer.

BCEagle91 · May 11, 2011, 11:57am

In the 1990s, Microsoft destroyed their main internet competition, Netscape and owned the web with Internet Explorer. I was playing around with Mozilla’s products after the slaughter and Phoenix/Firebird/Firefox rose out of the ashes but just getting IE’s markeshare below 90% took a massive, massive effort. It is, even still, hard to live completely without IE and I use virtual machines on my non-native-Windows systems for applications that only work on Windows or websites that only work with Internet Explorer.

The problem for Microsoft is that after getting the desktop browser monopoly - they relaxed, and competition came back in. That’s a problem for any dominant company.

To say that Microsoft doesn’t innovate is wrong. The do innovate in many areas but many of those areas aren’t visible to the average user. Microsoft Analytics (data mining) products are excellent. Take a look at the research work done by the late Jim Gray over the years at Microsoft.

I am not a fan of Microsoft but they are a serious company.

barrons · May 11, 2011, 12:27pm

Seriously mismananged. Sure they used monopoly power to “beat” Netscape and other browsers. But at great cost in both litigation and negative publicity. Since then their stock has tanked for a tech stock being flat for a decade with no end in sight. They were the evil empire. Now they are just a sad wallowing giant rapidly becoming a has been.

BCEagle91 · May 11, 2011, 12:53pm

Well, no argument there. Steve Ballmer should have been tossed out years ago.

Netscape had the browser monopoly in the mid-1990s and then they made the mistake of provoking Microsoft by stating that the browser could replace the desktop. That wasn’t true back then and it isn’t true today. But that provoked Microsoft to throw a few thousand engineers at Internet Explorer and the result was a much better product than what Netscape had to offer and Netscape never recovered. They couldn’t match Microsoft’s rate of innovation on the browser. Netscape spun off the browser/email/composition pieces to Open Source which was the beginning of Netscape (now SeaMonkey), email (now Thunderbird), browser (now Firefox) and Composer (latest usable version is Kompozer though it isn’t part of the Mozilla Foundation).

A lot of tech companies want to own the world and complacency sets in in a lot of companies. The ones that continue to thrive year-in and year-out, keep a startup mindset, even when they are mature companies.

Tying the browser to the browser to the operating system had some effect on their marketshare but if Netscape’s product was any good (and it wasn’t), then it really wouldn’t have mattered much. I don’t expect to put Ford steering wheels on my Toyota or even expect to have the option to do so. Some of the lawsuits around have been silly. Tech products that are significantly better will overcome things like tying. Look at Google, Firefox, Open Office, Apple, etc. They’ve all overcome strong competitors in the marketplace by building better products.

It’s rather interesting that IBM went through a similar period in the 1980s and early 1990s and then ran from $10 to $170 from 1993 to the current year. They seemed to work out their problems over a long period of time. I think that Ballmer has to go for Microsoft stock to do more than just bouncing around in the $20s and they have to put in place plans for growth.

Past performance does not predict future results.

barrons · May 11, 2011, 2:41pm

Silly or not Microsoft lost many of the suits and was exposed as a ruthless bully which opened the door for Apple to make a comeback being the cool company. And you Ford steering wheel is probably made by some company that also makes them for Toyota and Mazda. Same for the seats, wheels and many other pieces of the car. And they all fit and work well together in most cases.

BCEagle91 · May 11, 2011, 2:52pm

1) Microsoft lost many suits.

Yes. They paid out pocket change for them.

2) Apple opened the door themselves. They innovated on the iPod line and they used
a more efficient approach to operating system development on Mac OS X. They had a
settlement with Apple but Microsoft got quite a bit out of the deal too. And Microsoft
bought a ton of Apple stock so they benefited from the rise in Apple stock.

Now Apple is the ruthless bully.

That may be true. But you can’t order one with the Ford logo on it with your Toyota.

Branding is quite important.

I think that Toyota is more aligned with GM than Ford. Ford’s alliances are a bit different
than those of GM.

razorsharp · May 11, 2011, 3:19pm

Microsoft won only after using its monopoly power illegally to destroy Netscape. That was the finding of the federal district court in the suit brought against Microsoft.

After microsoft killed Netscape, there was no innovation in internet browsing. Microsoft is a giant company but they usually “innovate” by copying other companies or stealing their intellectual property.

Microsoft represents the worst of corporate America.

BCEagle91 · May 11, 2011, 3:27pm

Well findings of courts don’t necessarily reflect what happened in the marketplace.

Microsoft bundled the browser with the operating system. Netscape charged for their product and that was their business model. I bought a copy back in the 1990s. It’s hard to compete with free, right? Well, then why doesn’t Google charge for search, email, documents, spreadsheets, free phone calls, free voice mail, etc?

The funny thing is that Mozilla’s products are free today. The argument that you can’t compete with free is obviously wrong. But courts are often pretty dumb when it comes to technology.

You don’t know what you’re talking about. I worked on browser development for several years.

Microsoft spends a lot of money every year for applied research. As I said before, take a look at the published papers by Jim Gray.

There are a lot of companies in that group. Microsoft sells an incredible dollar volume of products around the world thereby reducing our trade imbalance. They employe tens of thousands in the US and their founder is very generous with his largesse.

BunsenBurner · May 11, 2011, 3:33pm

I’ve seen much worse. ;)

MSFT is OK, it is Steve Ballmer who represents the worst (as in “most useless”) of American CEOs.

ucsd_ucla_dad · May 11, 2011, 4:10pm

I don’t think I’m being too kind on this point. I remember buying the CP/M, Wordstar (my fingers still do the WS keyboard shortcuts), Wordperfect, Visicalc, and other apps at a cost of hundreds each. Worse than that were the mainframe based word processing apps I’ve used in the days before the PC. I even remember when web browsers, like Netscape, actually cost money to buy. Microsoft not only had apps that cost far less but the apps were far more capable than the others. One can now buy the Office suite of programs that do all of the above functions and more for less than a third of teh cost of the old Wordstar. And if someone doesn’t want to pay anything, there are knockoffs like StarOffice that copy the Microsoft products to some extent.

There’s no denying that if the Microsoft products weren’t considered a good value in price/capabilities Microsoft would never have become as successful as it has.

I’m not saying they’ve been perfect along the way, or that all of their products are perfect (especially when Vista blue-screens on me), but they’ve truly done more to bring down the cost and improve the capabilities of apps than many people realize.

Back to Skype - a large part of what Microsoft is buying is the user base and if they alienate that user base it will have ended up to be quite a bad investment. Hopefully they won’t do that.

razorsharp · May 11, 2011, 4:47pm

The most obvious example of non-innovation by Microsoft is Google. Once Microsoft took over internet browsing, it was in a position to completely control search. It had the gateway to the internet. So did Microsoft innovate a great search product? No. They did nothing. Microsoft could have been Google if even a few the supposedly smartest people in the world employed by Microsoft had a simple idea. Now Microsoft has a search engine that is so bad they had to steal search results from Google to make their engine look good.

Source: Google Publicly Accuses Microsoft’s Bing Of Stealing Their Search Results [Google</a> Publicly Accuses Microsoft’s Bing Of Stealing Their Search Results](<a href=“http://www.reelseo.com/google-accuses-bing/#ixzz1M4x5QJ4x]Google”>http://www.reelseo.com/google-accuses-bing/#ixzz1M4x5QJ4x)
©2008-2011 ReelSEO Video Marketing

Microsoft is evil.

BCEagle91 · May 11, 2011, 5:13pm

Your statement makes no sense. Take a look at Microsoft’s patents and
research over the last decade. You can’t ding a company for something
that it didn’t do.

FYI, Altavista was the first company to do automated (as opposed to
moderated) search.

Google’s innovation was in their business model for search where they
could make a sizable profit.

Google could have been Apple. Apple could have been Oracle. Oracle
could have been Cisco. Cisco could have been Applied Materials.
Applied Materials could have been Intel. Intel could have been
nVidia.

Your statement makes no sense.

There were a ton of database companies in the 1980s and 1990s. Now
there are three: Microsoft SQL Server, Oracle and IBM’s DB2.

There were a ton of operating systems in the 1980s and 1990s. The
primary ones remaining are Windows, Linux, a few from IBM and other
miscellaneous operating systems that the average person has never
heard of.

There were many Office Suites in the 1990s. The big ones today are
Microsoft Office and Open Office.

Google has had a number of failures along with their successes. To
cherry pick one company’s failures and compare them to another
company’s successes is unfair.

Have you ever used Microsoft Developer Studio? The debugging
environment is first-rate. Debugging in GDB/Emacs was so incredibly
painful until Emacs adopted Microsoft’s style of debugging. It’s only
available in later versions like Emacs23 (and maybe Emacs22) which you
have to pull and build on Unix systems. Emacs23 emulates the Microsoft
debugging environment through character-cell windows, which, while
ugly, are better than the old two-window style debugging.

Do you know what buffer-overflow protection is? Microsoft added it to
Visual Studio 2005 by default to prevent buffer-overflow attacks in
application software. GCC added this in 2008 or 2009 I believe. Is
that innovation? How about Whole-Program Pptimization? Profile-Guided
Optimization? GCC added these features well after Microsoft did.

razorsharp · May 11, 2011, 6:03pm

Sure you can. If the question is whether a company innovates a company who does not innovate should be criticized.

That’s like saying it is unfair to criticize John Kerry for running a rotten campaign and losing to George Bush. It is appropriate to compare competitors and Microsoft is usually the loser except in those areas where it uses its illegal monopoly power to screw its competitors.

There is no cherry picking of failures for Microsoft. There is a landslide of failures and second places by microsoft. For example, the graphic user interface was implemented by apple at least five years before msft. The local area network was several generations ahead by Novell until msft used its monopoly to force a defective product on users. It’s word processing, spreadsheet, etc were second rate until it forced out its competitors by bundling. msft attempted some innovation with its browser until it got rid of netscape with its monopoly power and then innovation stopped. MSFT tried to buy Google because it had no search product worth anything. All msft had to do in 1996 was have one guy say “let’s develop a way to rank web pages.” How hard is that idea for supposedly brilliant engineers? Apple comes out with the ipod, msft comes out with the zune several years later. Zune is everything you need to know about msft. sony comes out with playstation, msft comes out with xbox (which is actually a competitive product; but in msft fashion msft is second to the market). (kinect actually looks like a first for msft but that’s rare). msft has tons of software engineers yet mobile operating systems are Android and apple. msft windows 7 mobile is a joke.

No. Have you ever used Microsoft Word 2007. It is absolutely horrible. It appears to have been designed by monkeys.

If you don’t believe me that msft does not innovate, how about the NYT?

[Op-Ed</a> Contributor - Microsoft’s Creative Destruction - NYTimes.com](<a href=“http://www.nytimes.com/2010/02/04/opinion/04brass.html?pagewanted=2&ref=opinion]Op-Ed”>http://www.nytimes.com/2010/02/04/opinion/04brass.html?pagewanted=2&ref=opinion)

razorsharp · May 11, 2011, 6:24pm

[EBay</a> to Make $1.4 Billion on Skype - Bloomberg](<a href=“http://www.bloomberg.com/news/2011-05-11/ebay-to-make-1-4-billion-on-skype-after-microsoft-acquisition.html]EBay”>Bloomberg - Are you a robot?)

MSFT bought skype for 8.5 billion dollars. In 2005, ebay bought skype but then wrote down the value of skype to $900 million. In 2009, it was valued at about 2 billion. MSFT could have bought skype in 2005 or 2009, but instead it waited until 2011 and then paid at least double what anyone else would have paid for it. Stupid management.

barrons · May 11, 2011, 6:51pm

I’ve seen worse too–they tend to flock around a place called Wall Street.

BCEagle91 · May 11, 2011, 6:54pm

No you can’t. I’ve given you several examples where Microsoft has
innovated where Google, Apple, etc., haven’t. You just don’t
understand the innovations. The typical user only sees the user
experience and has no clue of what goes on under the covers.

Microsoft is the winner in many technology categories that aren’t
visible to retail customers. Microsoft has a bigger marketcap than
Google. It has a bigger patent portfolio too.

I’m a software engineer and can understand what they have done. Are
you a software engineer? Look at a company like Oracle. They build
technology that very few people understand but their software is used
all over the place. Do they innovate? How about Akamai? Their software
is used all over the web but they are not really user-visible. How
about EMC? They own VMWare, RSA Security and sell a ton of storage
devices. They have a significant cloud infrastructure. Do they
innovate?

Are you saying that Microsoft has had no successes and only failures?
If that’s the case, why are they worth more than Google? I’d suggest
you try a debugging session on Microsoft Developer Studio and then try
on on the competition: GCC - then tell me what you like better.

It’s really easy to be a Monday-morning quarterback but as I’ve said
over and over and over again, take a look at the research work that
Microsoft has done over the last ten years. You’re talking about
consumer products. Do you know anything about the success over their
server products?

I’ve used Microsoft Word 2008 and I do quite like it.

Tech media is notoriously bad. This guy talks about consumer products.
Where’s the talk about Microsoft’s server products?

In 2004, Oracle bought PeopleSoft for $26.50 a share. In the Internet
Collapse, PeopleSoft was something like $10/share or less. Oracle
chased the price up paying what was then considered a crazy price
for the company. The bet paid off handsomely.

I think that Microsoft buying One-Note was one of the best purchases
that they’ve done. It’s a fantastic product, originally aimed at
college students but it is a marvelous productivity and personal
management tool and nobody else has anything close to it.

razorsharp · May 11, 2011, 8:34pm

Ok, so you don’t believe me and you don’t believe the New York Times, but it looks like you believe wall street. Let’s see what share holders think? Google came public in April 2004 and has increased its share price by 394 percent to date. During that same time period MSFT is down 6.75 percent. Apple shares are up 2151 percent during that time period for one reason – innovation. It makes new products and creates new markets and sells a lot of stuff.

How about the last ten years (before Google went public)? Apple shares up 2939 percent. MSFT down 26 percent.

Maybe in its early days MSFT was innovative but since Ballmer its a dud.

Oracle purchased a major competitor to its main business. Fewer competitors means more profits. Of course it paid of. Buying skype does not eliminate any msft competitors to its core businesses. skype is a toy that earns no money.

BCEagle91 · May 11, 2011, 9:04pm

I’m a long-time professional in the business. I have vast training and
experience in the field. What are your credentials? What are the
credential of the New York Times? Are they experts in hardware,
software, networks, security, computer language theory? Have they ever
been the project leader of a product with ten million lines of code?

Did they ever have to regression test products for shipment and meet
project deadlines? Did they ever write functional specs?

Did you see the disgraceful treatment of the Duke Lacrosse Players by
the New York Times. Even now, the NYT can no admit that it was wrong
about the case.

I believe Wall St? I believe that Wall St is a bunch of crooks and
liars. There are various factors of momentum, short squeezes, long
squeezes and so on. But dividends don’t lie.

You’re good at cherry picking. What’s Microsoft up over its lifetime?

Which stock is up more over its lifetime, Apple or Microsoft? Which
company has been around longer?

There you go again, cherry picking timeframes.

I’m not a fan of Ballmer but your theses that Microsoft doesn’t innovate
is dead wrong.

I work in a company that it is a fierce competitor of Microsoft and we
don’t ever underestimate them. As a professional software engineer, you
have to give them a level of respect that amateurs can’t comprehend.

Yeah. Sure.

Wrong.

I guess you don’t work in IT either.

You apparently don’t understand Oracle’s strategy over the last
decade.

razorsharp · May 11, 2011, 9:19pm

There is more to analysis of a business and innovation than your own credentials and your perception of a business. Sometimes the wisdom of crowds is right and in this case the wisdom is that MSFT overpaid for a business it did not need. Regarding MSFT, I quote you, you are simply “wrong.”

Time to say goodbye to Skype ?

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