Reference no: EM132624049

MICROSOFT AS A HYPERCOMPETITIVE FIRMcannibalization  An Overview of MicrosoftBill GatesPaul Allensoftware market

Microsoft is a hypercompetitive firm operating in a hypercompetitive industry. It has used its dominance in operating systems (DOS and Windows) to move into a very strong position in application programs such as word processing and spreadsheets (Word and Excel). Even though Microsoft held 90% of the market for personal computer operating systems in 1992, it still invested millions in developing the next generation-Windows 95 and Windows NT. These were soon followed by Windows Me, XP, and Vista. Instead of trying to protect its advantage in the profitable DOS operating system, Microsoft actively sought to replace DOS with various versions of Windows. Before hypercompetition, most experts argued against of a company's own product line because it destroys a very profitable product instead of harvesting it like a "cash cow." According to this line of thought, a company would be better off defending its older products. New products would be introduced only if it could be proven that they would not take sales away from current products. Microsoft was one of the first companies to disprove this argument against cannibalization. Bill Gates, Microsoft's co-founder, chair, and CEO, realized that if his company didn't replace its own DOS product line with a better product, someone else would (such as Linux or IBM's OS/2 Warp). He knew that success in the software industry depends not so much on company size as on moving aggressively to the next competitive advantage before a competitor does. "This is a hypercompetitive market," explained Gates. "Scale is not all positive in this business. Cleverness is the position in this business." By 2008, Microsoft still controlled over 90% of operating systems software and had achieved a dominant position in applications software as well.

The captain of the ship  and his business partner  founded Microsoft in 1975. It is dominating the  since then, offering software and hardware products, operating systems, apps and devices, Cloud computing, and office software suites. Satya Nadella is currently in charge of Microsoft Corporation. The company is headquartered in Redmond, Washington, USA. Microsoft is inevitably the world's most renowned American multinational technology company. It's been at the forefront of technological advancement for more than 40 years and has made significant contributions to the technology industry. The world would really be a different place without Microsoft!

Question

1.  Make ten recommendations to Microsoft to remain as a leading software provider.