M$’s Desktop Monopoly Sinking Slowly

In Q3 2011, IDC reported that PC shipments are up 3.6% but M$’s profits on the client division of that other OS are down 1% from Q3 2010. Indeed, of 91 million PCs shipped, M$ had revenue of $4.868 billion, just $53.49 each. Why do they bother? Oh, yeah, it’s so they can convince folks they actually need that other stuff to keep the desktops running. At the same time they had to advertise 8% more to keep selling stuff.

The real story is not desktops. That’s small change. The real number of personal computers shipped was not a pesky 91million but hundreds of millions of smart thingies. M$ has 3.8% share of units shipped in the smart phone market and Europe alone ate 44million of those and the world is expected to eat 472million of those in 2011. So, the pie is exploding and M$ is shrinking…

As long as M$ is outside the mainstream growth of IT, it will rapidly shrink in market share. Meanwhile Android/Linux is expected to have 40% share of smart phones and growing rapidly. Tablets are the same story. Dozens of suppliers have not signed up with M$ and they produce the majority of tablets. Apple was at 80% share of tablets last year. In 2011, they are below 60% and could be at 50% after Christmas. That leaves Linux under Android on ARM and under GNU on x86/amd64 taking serious share from M$ and limiting growth. Even business, which is seriously locked in is in no rush to switch to “7”. This could get ugly for M$ very quickly.

About Robert Pogson

I am a retired teacher in Canada. I taught in the subject areas where I have worked for almost forty years: maths, physics, chemistry and computers. I love hunting, fishing, picking berries and mushrooms, too.
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One Response to M$’s Desktop Monopoly Sinking Slowly

  1. Contrarian says:

    “Why do they bother?”

    Well, a rich guy like you can sneer at a mere $4.868 billion, #pogson, but most others would not do that. You also ignore the almost $10B they received from allied product areas such as servers, tools, and office automation product sales. The Windows desktop netted them some $3.2B in profit. Compare that to the $0.04B profit generated by the biggest Linux supplier, Red Hat. Then go ask Red Hat if they would “bother”.

    You crow about the smart phone business and suggest that the almost $15B that Microsoft gets from Windows overall is “small change”, but the total value of the smart phone OS market is about $0.1B, and Microsoft is getting almost all of that even. Where are the profits from OS software in the phone market? Non-existent.

    Apple is certainly setting the world on fire with huge profits from their iPhone and iPad now surpassing their dominant iPod product, but the rest of the pack is not faring quite so well. Motorola, once a mainstay of the cell phone scene, has decided to exit the business and sell their assets to Google and HP, the main upscalse competitor to Apple’s iPad has decided to abandon the business entirely, finding no buyers for their struggling division.

    You may hope that Android powered phones and tablets are the champion steed that FOSS can finally ride to fame, but it is still looking like a tired old nag that doesn’t want to leave the barn.

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