InformationWeek: The Business Value of Technology

October 30, 2000

Printer ready

Editor's Note:
Microsoft: Are The Tables Turning?

By Stephanie Stahl

ver have one of those really great ideas pop into your head? Maybe it came to you while you were sleeping, or maybe you were at work. It was one of those really great ideas for a product or service that you know thousands, tens of thousands, maybe even more people would need and buy. But then, alas, you find out there are already about 50 such products on the market. Oh well, that entrepreneurial dream is squashed. That's bad enough. But what if your idea was unique, you got some VC funding, created a product, built a company around it, started making some significant sales, and then a giant swooped in and threatened to take it all away? That's not an unlikely scenario for many small software developers who have discovered a unique niche, only to find that Microsoft had its own plans for that niche. The choice: Take your chances and try to compete, redefine your business model and develop products that support Microsoft plans--or close up shop and get outta business, pal.

Don't get me wrong. I realize many independent software developers have reaped great rewards (read revenue) by developing products for the world's leading PC platform. Microsoft has helped nurture many along the path to profitability and has developed some long-lasting partnerships.

In this week's cover story ("Still At The Top?"), senior editor Aaron Ricadela takes a look at the complex and changing relationships between Microsoft and its thousands of developer partners. Perhaps the tables are being turned a little bit. More than ever, Microsoft is dependent on the support of the independent software vendor community for innovative solutions to surround its products. Certainly, Microsoft is feeling more vulnerable than it ever has for a number of reasons: Customers are more concerned about Internet bandwidth than PC operating systems; its server products are under siege by Oracle, Sun, and others; sales growth of server products is less than expected; revenue for desktop software such as Office is flat; many up-and-coming developers are putting their money on Linux, not Windows; legal troubles continue to add pressure; and the company is banking big-time on its forthcoming .Net strategy to help retain its leading position in the market. Given all that, can Microsoft still wield the same amount of power over the software vendor community that it's done in the past?

Additionally, our thanks to all of you who submitted candidates for InformationWeek's Chief of the Year honor. Our editorial team is poring over the impressive list of folks who are using technology to drive innovation through their businesses. We'll be featuring the winner in our Nov. 27 issue. Stay tuned.

STEPHANIE STAHL
Editor
sstahl@cmp.com

Back to the Columnists page
Back to This Week's Issue
Send Us Your Feedback
Top of the Page