Is Microsoft Losing It’s Touch?

Some people think that Microsoft is in trouble. Or, at least that the company won't grow like it did in the past.

The really basic question for Microsoft is this: How can it be more successful than it already has been? Microsoft can't make itself much bigger on the desktop because it already provides the operating system (and virtually all the word processors, spreadsheets, e-mail programs, and other key applications) for some 95% of the PCs sold around the world. The market for PCs isn't growing very fast simply because it's already so big.

This article claims that Microsoft's hope for the future is pinned on Longhorn, the next version of Windows, but I disagree.

Sure, Microsoft will never grow at the amazing rate it did through the 90s, but I think many of their "problems" (if you can say a company with more than 30 billion is cash has problems) are due to the current weakness of the computer industry. Short-term, I don't expect anything great from them, but long-term I still do, because of their research programs. Gates is not stupid, and he knows the Windows cash cow won't last forever, so he has invested heavily in a research facility with some of the world's best scientists. Much of what they are doing won't pay off for years, but when it does, Microsoft will reap the gains bigtime.

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