Microsoft's bid for Yahoopoints to a
radical shift in how the company perceives the
internet.
Many believe that Microsoft's existing approach to selling
software - particularly its market-leading
Office productivity suite - will no longer work in the internet
age. Any changes to the way Microsoft supports the internet will
radically alter how the company evolves its enterprise business in
the long term and the future direction of the Office, Windows
desktop and Windows server product families.
One of the gems in the Yahoo empire is
online advertising, a business area that Microsoft desperately
wants to move into. But Yahoo
also offers online applications that could bolster Microsoft's
existing
Windows Live online services for businesses and consumers.
While it has until now "supported" the internet, Microsoft makes
its money by selling
licences of software that is installed on desktop PCs and
servers. On the other hand, online search company
Google has started offering products and services through the
so-called internet "cloud", which enables software and services
to be delivered purely over the internet
In his blog posting, Forrester principal analyst Rob Koplowitz
said, "
Google has not only thumped Microsoft in search and advertising, it
has also taken the mind share lead in providing online business
applications."
Koplowitz said
Google Applications had enjoyed good take-up in the consumer
and, to a degree, the small business market.
"The delivery of business applications through the cloud might
pose a bigger ultimate threat to Microsoft than losing the search
and advertising wars," Koplowitz said. "Microsoft is a huge,
diversified company, but make no mistake, Office is paying more
than its share of the bills. Anything that threatens Office
threatens Microsoft. And Google threatens Office."
The changes that Microsoft looks set to make with Yahoo could
reflect the way other large IT companies are evolving in the
internet age. Ian
White,
in his IT collaboration blog, said, "Microsoft, like IBM, Cisco
et al, has been heavily re-inventing itself over the past couple of
years, and what we see today making news is a prerequisite to
enable the new beasts that will emerge from the carcases of the
past."
Ovum principal analyst John Delaney believes the proposed
marriage of Microsoft and Yahoo could enable the two companies to
develop a strong mobile internet strategy and support new types of
internet-hosted applications for businesses and consumers.
"A merged Microsoft/Yahoo could exert a hefty counterweight to
Google's mobile strategy," said Delaney. "On the software side,
Microsoft's mobile strategy has focused on the platform through its
Windows Mobile operating system. Yahoo, on the hand, has focused on
applications, including both individual applications such as
Flickr, as well as its integrated suite Go. A merged
Microsoft/Yahoo could start to develop the kind of integration
between platform and applications that is still only a gleam in
Google's eye."
But whatever the outcome, and whatever Microsoft's eventual
online strategy, businesses using Microsoft software have plenty of
alternatives.
One reader commenting on
Computer Weekly Networks Generation blogs said Linux had been
taking strides in recent years for desktop use. He said, "I took
the plunge two years ago to go fully Linux at home, and have not
looked back since. Ubuntu can install in less than 20 minutes, and
won't need to be rebooted for years. Software just 'works',
too."
Bill Maslen, also commenting on
Networks Generation, wondered if the move signalled the end of
Bill Gates' reign over the company. He said, "I wonder if Microsoft
would be contemplating this acquisition if Bill Gates was still the
main driver."
Maslen has moved his core business applications over to
non-Microsoft web servers. He said, "Setting up alternatives to
Exchange, SharePoint, SQL Server et al takes significantly less
time, and in the case of SharePoint and SQL Server can be matched
by some really astonishingly good open source software (take a look
at Deki Wiki, or Moodle)."
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