hyp0

It's important, but not enough. I don't think it's important enough, to buy a super-powerful (future) iphone, for just that, for enough people.

Consider PCs: also used for gaming, and certainly much more powerful than xone/P4, but PC sales have slowed.

And yet, people buy SSDs even though they could get more memory in a HDD. Because they value speed over capacity.

"The Innovator's Dilemma" traces back the disk drive industry, and in each generation, people choose smaller memory capacity, for the sake of a smaller package (there used to be 8 inch drives, for example). The theoretical idea is that once users' need for performance is satisfied (it's "good enough"), they turn their attention to other issues - such as price, convenience/ease-of-use, customization etc.

It has happened with desktops: that's what caused the brief "netbook" popularity, and what made smartphones successful. Desktops had overshot what was needed for many tasks (browsing, email); but the smaller devices were just becoming powerful enough to manage. So although desktops were more powerful, that extra power didn't matter to many users.

The underlying idea is twofold: (1) all technologies improve over time, as engineers find better ways to do things (Moore's law is just one example); (2) what users demand also increases over time, but at a slower rate

Therefore, if you start with new approach that really struggles with many tasks, eventually it will become powerful enough for what users need; during the same period, the old technology started off powerful enough, and became even more powerful - but users didn't care, because it was more than they needed (or, at least, they didn't want it as much as they wanted other qualities, like convenience etc).

Apple has the technology headroom to keep making more powerful iphones for several more generations... but will it reach a point where people don't need a more powerful phone? (that they don't get any benefit from it, so that power is not utilized). I would have thought they were more powerful than a phone needs to be already, but obviously not! One view is that they are still replacing desktops, suggesting users will value increases in power until they are as powerful as a desktop. Of course, gaming use is unlimited, but I'm not sure that's a key usage.

I would expect something like the Apple watch is essential for Apple, because that small form factor has lots of runway, as each increase in power would be a benefit to users.

really like the loading spinner, a fun extrapolation

also: swim, cycle

> 'Look, I made a hat where there never was a hat.' I mean, that just pretty much summarizes anybody who makes something artistic.

> "The joy of it is, there was nothing there, and now something that was in my head, is out there."

I feel we're approaching a resolution.

"Dead" is misleading hyperbole - pg emphasises that MS is "highly profitable". His data point is that MS, in his and startups' experience, is no longer a threat. It's just another big company.

I was wrong to say "constant" revenues. But I think my main point, the contrast between a rapid growth period and a steady mature phase, is accurate. The MAX graph shows it, but it's hard to appreciate the exponential growth on the left, because it's so small - expanding the scale would help show it. But MS was seen as astonishingly successful leading up to 1986 - data isn't even displayed for that far back. MS was founded in 1976, DOS released in 1981, which was an instant best seller, on the coattails of IBM's PC, which opened floodgates to the pent-up demand for desktop computers, with the reassurance of "I.B.M.".

So maybe "past its prime" isn't accurate either, but "past its period of incredible meteoric rise". Depends on the definition of "prime".

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Above is the quantitative data you're asking about. But there is qualitative data, too, which is the basis of predicting what will happen next. By looking at the basis of MS's business success, and knowing how businesses tend to evolve from studying other business, we can try to predict what will happen next. MS's success was based on IBMs -> DOS -> Windows -> Office, leveraging each to the next. With IBMs, DOS and Windows no longer dominant, they are left with Office fileformats and skill at serving business customers. These are strong skills, but the aren't the terrifying killer competitive advantages MS used to have.

So, maybe it's mostly the dramatic constrast with what MS used to be. If you didn't see what MS was before, the contrast wouldn't strike you.

I see that MS are having success with cloud-based enterprise stuff. This makes sense, if it's the same software; they are good at serving enterprise customers, who would prefer not to have to switch. It may also represent going up-market - which is typical for incumbents whose low-end is under threat. It often leads to better and better profits until the low-end is eventually good enough and takes over. (Christiansen's The Innovator's Dilemma). Resources and technical talent and business skill aren't enough to save a company when the grounds of their advantage erodes.

I think the basis of pg's idea is especially for web-based companies. You may have heard of startups getting killed by google moving into their space (or, buying them). It's especially dangerous for people making add-ons for twitter, facebook etc. Now, MS used to do with with Windows: you'd make a product, it was good, MS would roll out that feature in Windows itself... you are dead. But that doesn't happen for the web, because it isn't MS's platform. And so people aren't scared of MS - that's pg's point, I think.

Also adwords (the product that is actually sold). Brilliant idea: users only see ads relevant to their interests; advertisers get qualified users, and instant feedback and adjustment; google gets the highest price possible (by advertisers bidding against each other).

Google is double the good guy: (1) helps users for free, because advertisers pay for it (like free-to-air TV); (2) advertisers can't complain about google's high prices, because it's the other guy who bid it up (like selling munitions in an arms race).

I believe google came up with this independently BUT goto/overture did it first, patented it, sued, and google settled.

So far as revenue is concerned, this is Google's only product.

> I already know what the reaction to this essay will be. Half the readers will say that Microsoft is still an enormously profitable company, and that I should be more careful about drawing conclusions based on what a few people think in our insular little "Web 2.0" bubble. The other half, the younger half, will complain that this is old news.

Why the downvotes? If you look at the stock price over the MAX range, you can see exponential growth until 2000 - then it went sideways. Stock price represents the opinion of investors. It's not just programmers.

I'm guessing that if the balloon was often scraping ground, and they let gas out, it would be even worse. But the article could have clarified this, and at least spent a little more time on this pivotal moment of the narrative.

Astrology is obviously nonsense, but it seems plausible that the season of birth could have a personality effect: the cold dead of winter, with little fresh food vs spring etc, also from the attitudes of surrounding adults.

Of course, different near the equator, and phase-shifted in the southern hemisphere, and... much less pronounced in modern times, with supermarkets, refrigeration, air-conditioning/heating, imported foods, and wider social presence (newspapers, TV, radio, internet, phone) etc.

"which has been huge" is the key. Businesses typically grow, mature then decline. Microsoft's revenues had stopped growing. The very basis (PC) of their core franchines (Windows and Office) is in decline. It looks like a business that is past its prime.

Can Microsoft reverse this? It's hard for them, because they are so successful. Most other successes look small: e.g. their incredible and profitable xbox business isn't in the same league. To rejuvenate themselves would be like Google coming up with a better business than adwords, or xerox a better business than copiers. It's like Apple TV: a wild success for anyone else, but for a long time, a "hobby" for Apple.

BTW: Apple's rejuvenation, and creating several new categories, is incredibly unusual.

Can Microsoft maintain constant revenues? Windows still has a huge amount of software for it, and businesses rely on it. They also rely on Office. Phones and tablets have not really began to displace these business roles. Microsoft has made Office for them anyway; and it also has Windows for tablet (on Intel). These won't displace current phones/tablets - but they will enable businesses to keep using their software and Office.

Of course, there is an opportunity for new ways to serve businesses, using mobile devices, that will make the old Windows software obsolete. This is how Windows could die. Office might be harder to kill.