Yousuf Khan said:
Microsoft business model is over - MarketWatch
"If Intel can provide users with powerful little systems for $99 and
has been pushing prices lower and lower over the years, why can't
Microsoft? Intel makes elaborate hardware in billion-dollar
factories. Microsoft stamps out a disk. "
http://www.marketwatch.com/news/story/Microsoft-business-model-over/story.aspx?guid={4C81119F-100F-4D73-95AD-80424E949DC1}&dist=SecMostRead
*Sigh*
People will continue to pay for what they consider to be providing
value. As it is, the hardware itself has lost it's edge as the
differentiator, and today it's the software content that's the "killer
app". As for PC's, the majority of people don't buy them to 'play'
with - they tend to buy them to help them solve a problem,
e.g. talking to their daughter in another state using Skype or making
spreadsheets to handle their private finances.
Similar example:
When GSM phones first came around - some 15 years ago - Nokia just had
a better radio than Ericsson, and this was a killer at the time.
Magazines did the "cellar staircase" test routinely to see which
models had the best reception, and Nokia won hands down. Nokia spent
quite some time, money and effort to make their own radio, since it
was a differentiator.
As time went by, the other handset providers learned to catch up with
Nokia, and it ceased to be a differentiator in the market. Nokia
stopped doing their own radio and bought from 3rd parties.
Today, Nokia hardly make their own hardware (they've outsourced all
ASIC design). It's software features and design which is the
differentiator in the market, so they have moved their focus to that
instead.
The wheel of innovation (and reincarnation) turns...
Kai