Microsoft's Yahoo! bid: the end of Windows

Microsoft’s £22 billion (44.6 billion) bid for Yahoo! should worry any enterprise business that relies on MS infrastructure. In 2007 the company made $59 billion, so it’s fair to say that most of its 2007 earnings are going on this deal.

What this could mean is that Microsoft will shift its attention from being mainly seen as a provider of software infrastructure based on Microsoft Windows, to one that will sell online advertising, provide online search and run web communities like Flickr and del.ic.ious.

I believe Microsoft is already stretched. It is fighting Sony and Nintendo in the gaming market; Apple in online music; IBM et al in the open source world. At the same time, users are finding it less and less compelling to upgrade to the latest version of its expensively developed software infrastructure.

Who knows what the uptake of Windows Server 2008 will be when it starts shipping on February 28 2008? When Gates steps down this summer, will the company no longer see its software business as an important revenue stream? $44 billion is a heck of a lot of money to acquire a business. It’s more than all of Oracle’s total acquisitions – and remember, a few years back Microsoft did try to buy SAP. But it now has a stake in Facebook and is now putting in a bid for Yahoo!

So it seems enterprise software is not where the company sees its future. As my colleague John-Paul Kamath writes today, Microsoft has never been very good at supporting open standards, unlike Internet-focssed companies like Google and Yahoo!. If the sale goes ahead, Yahoo! could simply become another of Microsoft’s proprietary Windows-only platforms..

Start the conversation

Send me notifications when other members comment.

Please create a username to comment.

-ADS BY GOOGLE

SearchCIO

SearchSecurity

SearchNetworking

SearchDataCenter

SearchDataManagement

Close