When the Internet as we know it today started going through an explosive growth in the '90s the scenery changed and many new players stepped up to the plate and started chipping away at the software empire that Microsoft has built around itself. Initially Microsoft lost the browser wars with Netscape and today Firefox is slowly but surely reeling in more and more users who migrate from Internet Explorer. Even Hotmail, Microsoft's pride and joy, has slowly seen its market share being eroded away by Google's Gmail. And then there is the search engine wars, and it is pretty clear that Google has been victorious in that respect, despite the fact that Microsoft has sunk hundreds of millions of dollars into Live Search.
But there is more, as despite the fact that Microsoft has priced its new Vista operating system and Office suites well above previous generations, others continue to offer free alternatives. Ubuntu is gaining significant market share as a free OS with OpenOffice to cater to your office needs, whereas Google has been offering Google Docs, a free word processor and spreadsheet. If you look at the successful Internet companies that Microsoft was not able to add to its portfolio, it becomes pretty evident that Microsoft is fighting a losing battle online. YouTube and Blogger got bought by Google, further expanding their impressive lineup of online services. Flickr and Del.icio.us were snagged up by Yahoo whereas Skype
and StumbleUpon joined eBay's ranks. In terms of acquiring a huge potential source of revenue Google outclassed Microsoft by buying DoubleClick, the internet's number one advertising network.
Meanwhile, Microsoft is receiving heavy criticism from its end users as well. Many complain about the lack of new features in Vista and the fact that it seems to have inherited a lot from a software giant based in Cupertino. That's right, Apple's MacOS X and Vista bear many similarities. That is not the first time that Microsoft has been eyeing Apple's products and has tried to follow in its footsteps. Remember the Zune, Microsoft's answer to Apple’s iPod? No? Well, that is not surprising; the Zune has quietly faded away into oblivion after introduction. And then there is another Apple gadget that has been making waves - Apple's iPhone. And here is the catch; both the iPod and the iPhone work seamlessly with applications in MacOS X, causing for all the more reason to just make the switch and go with an Apple rather than a Microsoft-based PC.
Shall I just come right out and say it? Microsoft is not the innovator here, it has not been for a long time. It is hanging onto an eroding market share that will make the entire empire crumble beneath its feet in due time. A telltale sign is the fact that rather than buying the whole company - which they used to do - Microsoft just bought a mere 1.6 percent of Facebook for a staggering $240 million. That is not innovation, that is a desperate attempt to be a part of the action due to lack of vision. Apparently in '08 Microsoft is still playing catch up, just like in the '90s.