Microsoft‘s latest quarterly earnings report indicate a huge deficit problem at the world’s top PC software company. Turns out that they’ve lost more than 8.5 billion US dollars over the last nine years on what Bill Gates had classified as the company’s highest priority — capturing the Internet marketplace.
Last year, Microsoft faced a record $2.56 billion dollar loss in their Online Services Division (OSD for short). The division which built and sponsors their Bing product.
Way back on May 26th, 1995, Bill Gates sent the “Internet Tidal Wave” memorandum to Microsoft executives. In it he outlined the problems Microsoft was facing due to upstart Internet browsers and other companies who would inevitably take millions of users away from Microsoft and their PC-bound products. If they didn’t change their direction quickly, they’d be in big trouble. They started trying to dominate the online world and they’ve received heavy competition at every turn.
From MSN and Hotmail to MSNBC and Slate things haven’t been going their way. 17 years after Mr. Gates memo they’re still in big trouble. They’re under heavy scrutiny by investors and by users of their software.
They just spent $8.5 billion to purchase UK-based Skype. Why? Skype actually lost money last year, and its the second time they’ve been purchased.
Maybe that’s why their stock isn’t doing so well.
- Should Microsoft Dump Bing? (pcworld.com)
- Microsoft not introducing Bing instant search (winrumors.com)
- Should Facebook Take Bing Off Microsoft’s Hands? [Bing] (gizmodo.com)
- Why Microsoft Can’t (And Shouldn’t) Give Up On Bing (wired.com)