Microsoft’s Lost Decade and Apple’s Coming Days in the Desert

My buddy George Sidman shared this lengthy article on the decline and fall of Microsoft with me this morning. It’s a great read, if a bit wordy, and though it takes a while to get to the real point, it is nonetheless a very insightful bit of thinking.

Here’s what I wrote in response, edited to remove personal material.

I see this as a continuation or fulfillment of my long-held Saturation Theory. When a company that holds a dominant share of a market reaches the point where there are few if any new outlets for its products, it hunkers down and becomes an uninspired and uninspiring plodder more interested in managing its treasury and avoiding mistakes than in leading a charge that could cost it existing customers. What was the last innovative product Microsoft ever made? (For that matter, what was the first, but I digress.)
Apple is beginning to show the very first signs of this calcification. As it morphs from being a computer company to being a technology company to being a consumer electronics company, it begins to horde and defend. iPhone 5 and iOS6 are the first symptoms of this disease. Incremental improvements (200 of them but none of them world-changing) and poorly executed innovation (which way did they go?) combine to create a head-scratcher for which the Not-Steve rightfully and smartly apologizes. I fully expect to see the day — within five years tops — when Apple will sell its computer line to a company like a Lenovo that is great at commoditizing and carving pennies of profits out of tiny changes.
With Linux floundering on the shoals of Android’s fragmented universe, the most important technology question of the next few years is whether the Web (which is merely a loose collection of protocols) can grow up and become the new OS or whether something radically rethought will emerge and rock the industry the way IBM, Microsoft, Apple and Linux did in their now-fading days.

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