Now that the market for x86 PCs has stagnated, I expect M$ will have to start earning its income or it will decline. Coming to market with “8” years after Apple and Android/Linux took over the mobile space won’t save them. The monopoly is on its last legs and shortly the mobile infrastructure will eat into the x86 market either on ARMed CPUs or ported to x86 or both. There is no basis in technology for the continued monopoly and the usefulness of the monopoly for generating cash for “partners” is in doubt. The current shortage of hard drives will punctuate this change, tipping things over the cliff. The shipments of x86 PCs is about to decline for the first time and the monopoly depends on x86. OEMs will not cling to a sinking ship. M$ has left them with tiny margins which will soon be negative. OEMs will migrate to smarter technology, ARM and cheaper technology, smart phones and tablets which will continue to grow even as x86 declines.
The joy of “7” is about to be dampened by a grim year of 2012. The monopoly will inevitably decline. With it will go all the extensions of the monopoly: office suites and servers.
M$ can afford to maintain share price by increasing dividends but they cannot stem the flow of mindshare to other technologies. At the moment, predictions are that ARMed thingies will continue to grow while x86 stagnates for years. At this rate, M$’s installed base will start to shrink shortly and it will do well to save 50% of shipments for itself within three years. With that kind of competition the monopoly will be truly dead.
Evidence of decay are found in:
- M$ spending $5billion per annum on Bing only to lose $2.5billion
- M$ has only sold Phoney “7” on 2% of smart phones in the US and less in some other countries.
- Predictions are for a 10%+ decline in PC shipments for the next quarter due to shortages of hard drives.
Are OEMs going to do nothing as shipments decline or are they going to develop other product lines? The writing is on the wall. M$’s monopoly will shrink.