Go Stand in Front of a Train

Sage may claim they aren’t worried by Microsoft’s expanding interest in financial software but if I remember correctly, neither was Novel over NT or Intuit, over Quicken and Lotus Development over Excel. Of course there’s a list of equally unworried other companies going back in history, which might make a pretty war memorial to look back on one day, when I tell my grandchildren that Microsoft and software don’t mean the same thing.

It must be ten years since I predicted that Microsoft would start squeezing vertical markets, one by one, starting funnily enough with Flight Simulator, as it would be a relatively simple task to crush the relatively unsophisticated and expensive competition without anyone screaming “monopoly” to the nearest judge.

Of course, every company has the right to compete but very few companies are big enough and bad enough to have any chance of competing head-on with Microsoft and winning. However big Sage thinks it may be, if Microsoft wants a market and the customers that go with it, then it, it will, over time, out manoeuvre, out-compete and outspend its victim. It’s the industry equivalent of stepping in front of an express train, wearing clean underwear and hoping it won’t run you over.

When CDs first appeared, I predicted that one day, all the software you might need would be available on a single disk and ten years on, here’s another, pretty safe, prediction. Regardless of talk about open standards XML and .Net, within three to five years, there will be very few line of business and entertainment applications that will not be Microsoft badged, either directly or indirectly through partnership and investment. There will be choice still among financial products in an industry where loyalty is particularly strong but as the world moves towards a more on-line, Web-services style of delivery model, integration and cost will be valued over brand.

Some areas will of course be harder for Microsoft to crack than others. The X-Box needs to make an impact on the Japanese market if it is to squeeze-out Sony and businesses, like my own, aren’t going to throw out Sage or MYOB overnight, But ultimately, Microsoft will compete on price and features and customers will start to drift, as they did with so many other different software applications in the past.

Last week, when I was in the Middle east and while I was shopping for a USB pen drive, men kept leaping out of doorways and alleys offering me software. Other than the piracy issue, what was remarkable was that in almost every case, the CD on offer was Office and the same salesmen only had a single word of English to describe their wares,” Microsoft”.

– Make you think doesn’t it?


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