Saturday, February 02, 2008

Market Competition, and Kids in Garages Are Better Regulators Than the Department of Justice

WSJ Editorial: Remember when Microsoft was going to leverage its dominance of the operating-system market into control of the Internet? By a quirk of fate, at almost the exact moment that Justice filed suit against Microsoft in 1998, a couple of graduate students in Silicon Valley were seeking money for a little company they wanted to start. They called it Google.

Ten years on, Google isn't so little and Microsoft is a distant No. 3 in the search market. Yahoo, the No. 2 search engine, had seen its stock fall some 80% from its dot-com-era highs before Microsoft made its bid. Remember those days? It's funny how the one true Internet giant to emerge from the bubble wasn't even publicly traded when the Nasdaq poked its nose above 5,000 in March 2000. Business fortunes are hard to predict.

And so while Microsoft was being excoriated for including a Web browser with Windows and then -- horrors! -- a media player too, Apple found a killer app in iTunes and Microsoft's fleeting monopoly on a browser that it gave away didn't turn out to be a cash cow after all. It's hard to make it up on volume when the product is free.

Yes, Microsoft still makes lots of money selling Windows and Office. But the plans for world domination have been put on hold. Yahoo might help Microsoft give Google a run for its money. Or maybe -- just maybe -- there are some kids in a garage somewhere as you read this, writing the code that will make Google shareholders look back on its $160 billion market cap in early 2008 and weep.

We're willing to bet that in another 10 years all of us will be using the Internet in ways not yet invented in 2008. Microsoft's bid for Yahoo is, above all, an admission that while it was chasing the browser and media player markets, the world was moving on. That won't stop.


At 2/03/2008 9:09 AM, Anonymous Anonymous said...

"Fly Like an Eagle" by the Steve Miller Band

Time keeps on slippin, slippin, slippin
Into the future
Time keeps on slippin, slippin, slippin
Into the future

I want to fly like an eagle
To the sea
Fly like an eagle
Let my spirit carry me
I want to fly like an eagle
Till Im free
Oh, lord, through the revolution

Feed the babies
Who dont have enough to eat
Shoe the children
With no shoes on their feet
House the people
Livin in the street
Oh, oh, theres a solution

At 2/03/2008 11:20 AM, Anonymous Anonymous said...

The US presidential candidates are heading towards the $1bn mark in campaign fundraising, shattering records as Wall Street and corporate America pump cash into a race that started ­early and has produced at least eight viable candidates.

The highly competitive field has forced corporate interests to generously spread their contributions to ensure continued good standing with potential future presidents.

Microsoft's demise as a monopoly was it wasn't showering politicians with campaign contribution.

At 2/04/2008 1:25 AM, Anonymous Anonymous said...

Hmm, seriously do all these socialists find your site? I am almost positive its the kids at Michigan State. By the way anonymous #2, read the 1st amendment of the United State Constitution. Read it. Think about it. Think how it applies to campaign financing and get back to me.

Anyway...a little sanity here after those two retarded posts.

I agree with that article. In 10 years, Microsoft is going to regret purchasing Yahoo. It seems like a dumb deal and I don't see any competitive advantage Microsoft gains from this. Yahoo shareholders though should jump on this asap.

At 2/04/2008 9:59 AM, Anonymous Anonymous said...

Gee Mark, the next thing you know the "kids" are going to be offering assistance to Yahoo! to thwart Microsofts offer...

Now if Google can just keep the whole Yahoo thing tied up in anti-trust law suits for a few years...

At 2/04/2008 10:11 AM, Anonymous Anonymous said...

How Google Could Keep Yahoo From Microsoft


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