Ian Hilliard <nospam@xxxxxxxxxxxxxxxx> espoused:
> amicus_curious wrote:
>
>>> Microsoft is no longer a tech boom company and it's chances of expansion
>>> are
>>> very limited. Investors are looking for greener pastures and companies
>>> like
>>> Google have much better chances of growth. This is reflecting on
>>> Microsoft's share price.
>>>
>> Well, getting money for advertising one's favorite keywords is certainly a
>> lot more fundamental than manufacturing automobiles, appliances, or useful
>> software, but can it scale to the size of MSFT? GOOG is very profitable,
>> although not as profitable by half as MSFT on an EPS basis. They are also
>> a much smaller operation. Do you believe that Google can scale by 700%
>> from what they are now and still maintain that kind of profitability? If
>> they could, they would be 50% as successful in terms of profits as
>> Microsoft. To scale by 700% means that Google has to have 7 times the
>> traffic that it has now, but at their current rate of growth, that will be
>> a while in coming. If you are certain and also correct, you should be
>> hopping on board this roaring express so as to guarantee your future. If
>> you become financially independent you can devote ever so much more time
>> to developing free software.
>
> Well Mr. Weisgerber,
>
> You may understand the dollars and cents,
Um, no he doesn't - he's just pulled some figures out of the air, as he
always. His fundamental error is that Google's /profit/ (not revenue,
mark you) is directly proportional to "traffic". I'm not aware of any
basis on which to make this claim, but I /do/ know that Google have been
phenomenally successful in gaining advertising revenue, and global
advertising budgets are now so huge they're becoming comparable with
telecoms and ICT, and have already outweighed computer gaming and
film/music revenues.
All Google actually need to do is retain their huge share of a growing
market, and their revenue will continue to rise. As their cost base is
unlikely to change during this period, their profit will rise much
faster - they do not have traditional production costs any more than
Microsoft do.
Furthermore, Google are still growing at > 90% per annum, but our Mr
Wiesgerber doesn't grasp the significance of the difference between
growth and margin.
> but what you haven't understood is
> that every action has an equal and opposite reaction.
>
> Microsoft has screwed over the computer for ten years, sucking the life
> blood out of it. The reaction has been to turn the open source movement,
> which has existed for a very long time, into a movement to put Microsoft
> back in it's place. You can repress movements, as the communists did for
> many years, but the more you repress a movement the more determined it
> becomes.
>
> Microsoft has a lot of money in the bank and it can buy a lot of PR time,
> but it can't quash a movement, particular one that has become so active
> because of Microsoft's very behaviour.
>
> The movement is ensuring that Microsoft does not get a strangle hold on
> ultra mobile computing, which will become a major section of the market in
> the next few years. As the desktop becomes less and less important so will
> Microsoft. In a mobile environment, service oriented applications will
> become more and more important. This is where Google is making major
> inroads and their use of Linux has meant that they can do it far more cost
> effectively than someone attempting to use Windows.
>
> There was a time when the Union Pacific Railway Company was one of the most
> powerful companies in the United States and perhaps the world. New
> technologies marginalised them. Microsoft is still on a roll, but its days
> are numbered and the market knows that. You just have to look at
> Microsoft's share price to know that the market knows that.
I agree with this - Microsoft are in a long-term fall. This is
generally accepted, of course, except by the shills.
>
> As a final comment. If you really stand behind your statements, why don't
> you use your real name. I do.
>
Me too :-)
--
| Mark Kent -- mark at ellandroad dot demon dot co dot uk |
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