Ballmer’s latest acquisition

In a bold move, Microsoft acquires Nokia and catapults itself to the top of the smartphone world. The full integration of Windows Phone 7 software into Nokia hardware will result in a better user experience for customers, a zero-fragmentation platform for developers, easier deployment of a smaller number of SKUs for retailers, and more reliable update management for carriers.

It’s worked before. Microsoft’s hardware/software integrated devices, Xbox and Kinect, are enjoying strong revenue growth and great margins: $1.9B revenue last quarter, 50% more than last year, with 10% operating profit.

In a prepared statement, Microsoft CEO Steve Ballmer says:

‘I welcome Stephen Elop back into my executive staff. His brief leave of absence has allowed us to more fully explore the possibilities of combining the best smartphone hardware, Nokia’s, with the best OS, Windows Phone 7.
Google’s anticompetitive Android free and open licensing practices unfairly tilted the playing field against our better product; they made it impossible for us to sell Windows Phone 7 software. Instead, we‘re now ready to do battle with Apple from a superior position: a stronger product carrying the Windows Everywhere flag, wider carrier distribution around the world, and more retail partners in US, Europe, and BRIC nations. With our acquisition of Nokia, we’re now a $100B company, back where we belong: at the top of the high-tech industry.’

When I woke up, I heard a different story: Microsoft bought Skype for $8.5B.

We all know Skype: free voice and video calls from computer to computer, plus paid services if you need to dial a phone. As Skype prepared for its long-awaited IPO, we got financial data from their S-1 filing with the SEC. S-1s are always instructive: This is usually the first time a private company opens the kimono — and the SEC watches closely as you prepare to sell shares to widows and orphans.

The Profit & Loss statement in Skype’s S-1 looks like this:

With revenue of $860M in 2010, Skype’s Operating Profit is a modest $20M, with a Net Loss of $69M due to interest expenses stemming from $686M in long-term debt. Except for in 2008, when they saw a $42M profit, Skype has racked up huge losses, including $1.4B in 2007 and $370M in 2009.

(Technically, these figures straddle two different corporate structures because of Skype’s complicated history. Started in 2003 as an independent European company, Skype was acquired by eBay in 2005 for a price pegged between $2.6B and $3.1B. After the acquisition, eBay discovered its ownership of Skype was “encumbered”: A crucial piece of Skype’s technology was owned by another company, Joltid, which was essentially in the hands of Niklas Zennström, one of Skype’s founders. eBay settled with Joltid for about 14% of Skype. This caused wags to say the crafty Skype founders sold the company twice — and it certainly didn’t make the ex-management consultants running eBay look so sharp. In 2009, eBay sold 70% of Skype to private equity and venture investors in a transaction that valued the company at $2.75B.)

Why did Microsoft pay $8.5B — 10 times the company’s revenue – for a business that has changed hands so many times, never made money, and comes with substantial debt? (Admittedly, the $686M debt number is manageable — for Microsoft).

One eloquent answer comes from Ben Horowitz, a partner at the Andreessen Horowitz venture firm started by Netscape’s founder. Horowitz invokes the network effect: A large number of users attracts more users and so on, in a kind of gravitation well:

- 500,000 new registered users per day
- 170 million connected users
- 30 million users communicating on the Skype platform concurrently
- 209 billion voice and video minutes in 2010

And he concludes:

Today, I tip my hat to an old rival, Microsoft. By acquiring Skype, Microsoft becomes a much stronger player in mobile and the clear market leader in Internet voice and video communications. More importantly, Microsoft gets a team, ably led by the exceptional Tony Bates, that can compete with anyone.

Well, this is a nice encomium to the guys who transformed the venture firm’s $50M investment in Skype a few months ago into a $150M payday. My own venture investor hat is tipped to MM. Andreessen and Horowitz.

But not so much to Steve Ballmer.

Looking at Microsoft’s recent quarterly numbers, we see the continuation of a now old and getting older tradition: losses in the Online Services Division. Only a few weeks ago, TechCrunch wondered: When Will Microsoft’s Internet Bloodbath End? Business Insider provided a vivid illustration for the problem:

In just the past 12 months, Microsoft has lost $2.5B in its Online business. They spend $2 to make $1 in revenue. Buying and “integrating” Skype will make the picture even redder.

So, again, why spend $8.5B on Skype?

The official explanation is that Skype will be targeted at professional users. For these, Microsoft already has a product called Lync, although not many have heard of it. And they have Messenger for consumers. (Actually, it’s Windows Live Messenger for Windows and Microsoft Messenger for the Mac.) I don’t think it’s unfair to ask how, how well, and when Microsoft’s Grand Unified Messaging platform will effectively exist, and how it will be monetized.

Given Microsoft’s track record, there isn’t much evidence of its ability to perform such integration, nor of its ability to move a big platform forward at a competitive pace, certainly not faster than what Google seems able to do with Google Voice, Talk and Google Video for Business.

The theory must be that every Windows PC will come with “Skype inside.” But that isn’t much progress: There are already 170 million connected Skype users, and 500,000 new registrations everyday. And imagine how carriers will react when they see a Skype client bundled with every Windows Phone 7 device, further pushing them towards their preordained destination: dumb pipes.

Today, Skype is joyfully used in both consumer and business environments. It’s not perfect, but the price is right and Skype is now a verb. The next thing we know, Microsoft will take a good if imperfect service and “improve” it by integrating it with Office or SharePoint (a good product on its own). And, at some point, Microsoft will try to make us pay for it. In more ways than one.

But, again, the history isn’t there. Microsoft’s ability to successfully charge for a formerly free product is lacking.

Reactions to the Skype deal have been negative, if not downright derisive. Many see the Skype acquisition as more evidence that Microsoft can’t innovate, or even effectively copy and out-implement anymore. One local exec asked, rhetorically, how much it’d take to re-implement Skype. $100M? $1B? It’s not a question of money. Microsoft spends tons in R&D: 15% of sales, about $9B per year. (Apple spends 2% of revenue, less than $2B.) Think of iTunes: it’s been out there for close to ten years and there’s no iTunes clone coming out of Redmond. Microsoft has to buy what it no longer has the people or the culture to create — or copy.

David Pogue, the NY Times’ tech guru, thinks this acquisition will go where so many went before: to failure by mediocrity and to poisoning by matrix management.

Ben Brooks, a Microsoft shareholder — and not the disgruntled kind — comments on the Skype deal and concludes: The Ballmer Days Are Over. Perhaps, but who can tackle the job of turning Microsoft around?

In last year’s May 30th Monday Note, I wrote Ballmer had opened the “Second Envelope”. He was running out of explanations: first blame your predecessor, then fire a few subordinates. Next, you’re out of excuses and out the door.

Since then, a few more subordinates have decided to “spend more time with their families”: CTO Ray Ozzie, who wrote a long, long farewell memo (don’t do that, it doesn’t make you look good); Tablet executive Bill Mitchell; Bob Muglia, President of the Server and Tools Division. We’ll exclude Stephen Elop, the President of the Business Division who went on to rescue Nokia, as he might have left of his own volition — or of his seeing Ballmer looking for the next excuse.

Last year, I noted Microsoft’s stock had been stagnant for almost ten years. Things haven’t improved since then:

In the past 12 months, Microsoft’s stock has fallen by 11% while the Nasdaq climbed 25%, Google 7%, and Apple 44%.

Having run out of ideas and envelopes, is Ballmer spending $8.5B of Microsoft’s $50B cash, its biggest acquisition so far, as a desperate tentative to keep the company, or himself, in the game?

Back to the fantasy: Today, Nokia’s market cap is about $32B, a bit less than four times Skype’s price. In theory, Microsoft would have to pay a premium…but imagine Nokia’s situation if Microsoft hadn’t generously “lent” them Stephen Elop and struck a Windows Phone 7 deal “worth billions” to the Finnish company. What would be the market cap for a rudderless Nokia?

And Nokia comes with revenue, about $40B last year. The Nokia Devices and Services business alone makes about $3B in profits per year — almost as much as Microsoft’s Online division lost in 2010.

That would get attention, and credibility, and criticism, and hope. Instead, we got a yawn.

JLG@mondaynote.com

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45 Comments

  1. Kurt Usen
    Posted May 15, 2011 at 10:24 pm | Permalink

    “What would be the market cap for a rudderless Nokia?”

    Don’t get it. Market cap for ‘Elopless’ Nokia was about $40B…

  2. Jean-Louis Gassée
    Posted May 15, 2011 at 10:49 pm | Permalink

    @Kurt Usen: That was before Nokia’s numbers started to show the combined impact of Android and iPhone. See http://bit.ly/loOaCX, this is the Google Finance stock chart, and set the interval to six months, NOK lost 17%, or 1 year, also 17%. I spoke ay Nokia’s US HQ in White Plains last June. That was before OPK got the boot. I wrote a half serious Monday Note as a result, see http://bit.ly/aUxVEP. Middle management was largely aware of the problem “upstairs”. Largely means not totally, a few people ascribed the iPhone’s success to “marketing”, meaning iPhone buyers were poor schlobs fooled by fancy ads. Nice.
    One of my two points today is MS is having a good time selling integrated, closed, wall garden, pick your cliché, devices. Buying Nokia would be consistent with the Entertainment & Devices Division winning streak.
    Buying Nokia, assuming things not in evidence such as shareholders agreeing, and Finnish pride ceding to reality, could be done with equity or equity + cash. This would put MS at the forefront of the next wave or computing: Really Personal Computers. JLG

  3. SpragueD
    Posted May 15, 2011 at 11:19 pm | Permalink

    Your critique of Microsoft’s strategy may be tainted by your history with them.You are surely the last person — perhaps next to Eric Schmidt — who should be considered a disinterested observer of Ballmer & Co.

    http://lists.essential.org/info-policy-notes/msg00005.html

  4. Walt French
    Posted May 15, 2011 at 11:41 pm | Permalink

    MM Andreesen and Ballmer both said what their official positions dictated that they must. That said, the logic for a Skype acquisition utterly escapes me. Unless Microsoft moves to quickly eliminate alternative VoIP networks that might spring up (an anti-competitive impossibility), Skype users will refuse to pay the planned Microsoft surcharge. And as you note, the potential for workgroup collaboration is already embedded into Microsoft services and does not benefit from Skype, except perhaps as a user-interface team.

    This bodes exactly as well as the Danger acquisition did. Talent will bolt after their golden handcuffs unlock; VCs will have a field day fronting new alternatives. Bon chance!

    The only reason I can see for this deal is to soften the blow of what I expect will be truly ugly numbers for WP7. The Nokia deal is already a year down the road in terms of impact; Skype will push out the average duration another quarter or two, and Ballmer will be able to claim that he is building for the Future. Why MS shareholders want to pay for actions that MAY be realized years in the future, without any sign of a cohesive strategy that demands Ballmer at the helm, is beyond me.

  5. Posted May 16, 2011 at 2:45 am | Permalink

    It’s a desperate move by Ballmer. Especially as we learn that Facebook and Google weren’t all that interested and only remained in the race to drive up the price of Skype. $8.5 billion is insane but cash is one thing Microsoft has and Ballmer knows that tossing it around keeps everyone distracted and from asking about the failures of the Online Division and Windows Phone 7. Windows and Office will continue to mint billions. But who is excited to purchase either? It’s like paying for garbage service or car insurance. Gates controls the MSFT board which means Ballmer would have to commit a felony before he’d be shown the door. So we end up with a once dominant and feared company becoming less relevant each day.

  6. Posted May 16, 2011 at 2:48 am | Permalink

    Thank you for writing this post, you’ve articulated your position well. While I’ve been critical of Microsoft and Ballmer in the past, I view acquiring Skype for 8.5B akin to Google’s YouTube overpayment, Microsoft’s Hotmail acquisition, or Facebook investment. Yes- they’ve “overpaid,” but at the same time they’ve created billions more in value.
    Skype is a valuable product and network- I am willing to bet there is more than $6B in latent value within the company. It’s up to Microsoft to realize it.

    A point of clarification. You write: “Think of iTunes: it’s been out there for close to ten years and there’s no iTunes clone coming out of Redmond. Microsoft has to buy what it no longer has the people or the culture to create — or copy.”
    Not to call either a copy cat clone but I think you’re overlooking both Windows Media Player and Zune software both of which are blatant iTunes competitors, the latter even handles Windows Phone 7 syncing. Whether you like iTunes more is another discussion, but its clear Microsoft is building a competitor.

    When people cite the cost of building a platform for example building another product, they over look two things, the time cost, while they are building the industry is moving, second the opportunity cost- their understaffed engineering teams become even more understaffed as they look to increase expertise in a new area to release a consumer product, and the third point is getting users. Let Google’s forays in Social Media and Microsoft’s forays in search be evidence that if you build it- they will not come and getting them to come is expensive.

    Disclosure: I’m employed by Microsoft.

  7. Jean-Louis Gassée
    Posted May 16, 2011 at 2:53 am | Permalink

    @SpragueD: I respect your right to say whatever you wish about me personally. This said, I’d prefer we focus on ideas, opinions, facts. Is there anything else you’d like to share? JLG

  8. Jean-Louis Gassée
    Posted May 16, 2011 at 3:06 am | Permalink

    @Mikal Lewis: You’re right, the Skype acquisition could end up being successful. For Microsoft’s sake, I hope it is.
    As for Windows Media Player and Zune, I beg to differ with you: I think they do prove MS hasn’t been able to extend its franchise into those domains. The Zune is dead or dying. And compare iTunes’ inroad into the Windows user base, versus the WMP penetration, in spite of being bundled.
    Hotmail was a great acquisition but has been left behind by Gmail and the associated Google products.
    You’re right again about MSFT’s and GOOG’s forays into social networking. I’m personally mystified by their lack of success. I have to resort to broad but not very illuminating explanations of “culture”.
    Both companies have a huge user base of one sort or another and both have failed to leverage it.
    Back to iTunes: I don’t like it, few people do. We use it because it’s there but it’s bloated, unattractive, trying to do too much in one product.
    Once upon a time, iTunes proved Apple was willing and able to write Windows software. But the time has come to break iTunes down. JLG

  9. Jean-Louis Gassée
    Posted May 16, 2011 at 3:14 am | Permalink

    @Walt French: Ballmer, to his credit, never, ever gives up. He takes the blows, ignores what he’d said before and moves forward. No tongue-in-cheek here, I admire his energy, his presence and articulateness. He can’t change his company’s culture, so he works with what he has. He’ll be very hard to replace. A “caretaker CEO” would drive the place to the Grand Canyon in no time. JLG

  10. Jean-Louis Gassée
    Posted May 16, 2011 at 3:23 am | Permalink

    @Brett Nordquist: Walt French is right, Ballmer had to do _something_. Call it a desperate move, as you do, or call it a defense against both GOOG and FB further snaring users in a Voice and Video network of their own. (BTW: the stock symbol BOOK is available on bothe NYSE and NASDAQ, taken in Hungary.)
    In the end, failure to integrate will prove you right and even Gates won’t be able to go against shareholders forever. JLG

  11. Posted May 16, 2011 at 3:50 am | Permalink

    JLGL: I value your insight and your opinions and love to read what you have to share. I agree with you and wonder how long Microsoft needs to suffer under Balmer and who might step up to take his place. That said, Steve Jobs is a hero of mine in several ways.

  12. apetra
    Posted May 16, 2011 at 4:28 am | Permalink

    it was a gutsy call.

  13. Hamranhansenhansen
    Posted May 16, 2011 at 5:50 am | Permalink

    You’re so right that Microsoft needs to transition to making integrated devices. Their business of broadly licensing low-risk high-profit software to hardware manufacturers has clearly been made obsolete by companies like Foxconn, who outsource manufacturing from the hardware makers themselves, turning the hardware maker into a kind of software licensor. Microsoft looks at integrated devices as the opposite of the software licensing that they do, but because of companies like Foxconn, integrated devices is the next generation of software licensing. You license further down than the kernel, you include the hardware specification also.

    In the 80’s and 90’s, the knock on Apple was that they should license their operating system to compete with Microsoft, but Apple actually does that now, only they license their OS along with a complete hardware design to Foxconn (better than Microsoft’s software only) and they Apple-brand the result and provide complete service and support (better than Microsoft’s bifurcated support.) In the same way that so much of PC computing once orbited around 1 Windows software, so much of phone computing now orbits around not just 1 iOS, but 1 iPhone. In the same way that CS/IT-savvy 1995 PC users installed applications and customized hardware with plug-in PCI cards and serial/parallel port accessories, today, non-technical users install iPhone apps with 1-click and customize hardware with plug-in dock accessories and USB, Bluetooth, and Wi-Fi accessories. An iPhone case with a credit card reader essentially runs iOS, which you install by putting in the iPhone. The driver for the card reader is a 1-click native app.

    So Apple has stolen Microsoft’s business model, improved it in various ways, and become the king of the next evolution of software licensing. Where Microsoft broadly-licensed, Apple narrowly licenses. Where Microsoft outsourced manufacturing to Compaq, Apple outsources it to Foxconn. That is why Microsoft used to have the advantage of economies of scale, but now it is Apple. Today, nobody can compete with iPad at $499 or MacBook Air at $999.

    So not only should Microsoft have bought Nokia, I think they should have merged Microsoft+Nokia+HP so that they have one company that is somewhat equivalent to Apple, with PC and phone hardware/software under one roof. Microsoft, Nokia, and HP are essentially one company already, but just badly disorganized, slowed down by the fact that they have to constantly make individual agreements and alliances because they are technically separate companies. They are slowed down because they are making the left side of the product in Washington and the right side of the product in California/Finland (no wonder they see the value in Skype) and hoping they fit together later. And they are slowed down because there is essentially no leader, no CEO above the whole thing. Ballmer is chief of software, Elop is chief of phone hardware, Apotheker is chief of PC hardware, and there is no CEO. Meanwhile, Apple has CEO of the decade, with software and hardware and manufacturing all working as one under him.

    So the flip side of Apple-must-license is true today: Microsoft-must-integrate. How are Microsoft and Nokia and HP going to compete with Apple if they don’t start working together? It is the opposite of the 80’s and 90’s PC industry now, it is Microsoft who isn’t moving forward, isn’t adapting, not Apple-without-Jobs.

    Microsoft is still trying to redo their inheritance of the IBM monopoly and prove Bill Gates right, but it is Jobs who is proving both himself and Bill Gates right, by making the integrated hardware/software devices Jobs is famous for, yet also recognizing the value of software and outsourcing the manufacturing, which Gates is famous for. So it is Jobs that ironically continued Gates’ legacy, not Ballmer. And Jobs continued his own legacy also. The guy has The Balls.

    It is sort of strange to say that Microsoft is too small to compete, but that is what is happening. They need to merge with the parts they are missing and get bigger fast or they will just continue to be passed by. They can’t move quickly enough all split up. (Also ironic that a few years ago we were talking about splitting Microsoft up into 3 companies, and now they are only 1/3rd of a company.)

    Skype? They bought it because it is famous, and they remember when they were famous, and it makes them feel famous again. Complete self-indulgence. Very shortly, anyone will be able to make their own FaceTime for very minimal cost, because FaceTime is a suite of open components that is already in all the devices from every manufacturer. The only knock on FaceTime is it is immature as yet, less than a year old. It doesn’t have all the features yet and the specification is not done. But it’s modern VoIP, as it would be designed for smartphones, not PC’s, and it already has 150 million users or so, and it’s already preinstalled and integrated with the default phone and contacts on devices, and much, much easier to use than Skype. It’s Skype for grandmas. It will be very interesting to compare FaceTime and Skype when FaceTime is 2 years old in June, 2012. Not just in features and user base, but economically. How much to build/buy it? How much does it cost to use? How much money does it make?

  14. Jean-Louis Gassée
    Posted May 16, 2011 at 6:03 am | Permalink

    @Hamranhansenhansen: Very insightful take on Apple’s execution of the software licensing model via Foxconn, re-branding the output and supporting it. Regrettably, we won’t get Bill Gates’ reaction to your views: Being outdone by Jobs on the licensing field :-) JLG

  15. Walt French
    Posted May 16, 2011 at 6:39 am | Permalink

    @Hamranhansenhansen, one tiny issue: FaceTime, proclaimed “starting today (announcement date) we are submitting to standardization bodies” (paraphrased), has yet to show up at any.

    Word has it that nobody inside Apple was aware of it. I *suspect* there are all sorts of QuickTime or other proprietary features that’ll be difficult to abstract out and make interoperable, and to which Apple will not voluntarily cede control. Apple *could* open it all up, but I suspect there’ll be a very different version at best.

  16. mark s.
    Posted May 16, 2011 at 7:37 am | Permalink

    microsoft is clueless.

    ballmer must go.

  17. Brad Howes
    Posted May 16, 2011 at 9:05 am | Permalink

    I’ve been perplexed by this deal even as it makes me a new MS employee. My only conclusion is that MS wanted unencumbered access to the relationship graph of the Skype membership base in hopes that with proper integration with MS products it would spur sales and lead to some vertical integration that Apple already has and that Google is spasmodically going for. But Apple is trying to drive hardware sales where they have a good command of the high-margin space, while Google is trying to capture information and keep eyes on its web real estate in order to increase ad sales. On the MS side, there certainly are plenty of integration points, but I’m just not clear on the revenue generating streams apart from the obvious one, advertising. Regardless, this should be an interesting and even exciting next couple of years for me!

  18. Stephane
    Posted May 16, 2011 at 3:00 pm | Permalink

    Also, I would have liked to be a fly on Ben Horowitz office wall.
    Last Millenar, Microsoft killed Netscape. And Netscape was the baby Ben had co-invented and sold to AOL. The weapon of mass destruction? Just offering for Free a me-too browser, Internet Explorer.

    Now Ben returns, selling for $B8.5 a Free software to Microsoft… that Microsoft failed to copy.

    Etonnant, non ?
    ;-)

  19. Jean-Louis Gassée
    Posted May 16, 2011 at 5:34 pm | Permalink

    Telepathy? Dream come true? Now this rumor http://read.bi/lRr5Ry from Eldar Murtazin: Microsoft in talks to buy Nokia’s phone unit. Only a rumor so far.

  20. Tom B
    Posted May 19, 2011 at 2:59 pm | Permalink

    ” Gates controls the MSFT board which means Ballmer would have to commit a felony before he’d be shown the door”

    MSFT should reserve a nice $3000 hotel suite in NYC for Ballmer.

    **********************************************************
    I doubt XBox’s (the only feather in MSFT’s cap) current success will be long lived. The division is still something like 20 billion in the red since they bought it. XBox benefitted quite a bit from 1) Halo 2) Sony’s failure to kill Blu Ray when it was clear that would be a drag on PS3 sales 3) the new input device, the Kinect (which Apple deemed not sufficiently interesting to acquire, by the way, which means they have something MORE interesting in the pipeline). None of these are durable advantages. The Xbox is kind of long in the tooth at this point, and the Wii shows that a little innovation can swing sales in your direction pretty quickly; the game console audience is not so loyal that they can’t be moved from on franchise to another.

  21. Posted May 24, 2011 at 7:42 pm | Permalink

    Who really cares about Nokia’s market cap vs Skype’s? Microsoft acquired them for $0 when they convinced them to dump MeeGo and Symbian in favor of WP7.

  22. David
    Posted May 24, 2011 at 8:06 pm | Permalink

    I cannot think of even one successful transition from free to revenue product. Even Apple whose users are sometimes loyal to the point of stupidity doesn’t make enough money from MobileMe to show up as anything but a rounding error on their financials.

    Steven Osborn is right. MS effectively acquired Nokia for $0. That was a smart move. Paying $8.5B for Skype was anything but.

  23. Shaun
    Posted May 24, 2011 at 9:06 pm | Permalink

    Steven Osborn has it spot on. Microsoft don’t need to acquire Nokia. Nokia jumped for them from their own ‘burning platform’ to the cold icy empty sea that is Windows Phone. There’s even less interest in developing for WP than Symbian.

    The share price dropped because of that. You can track the share price drop from the minute Elop opened his mouth.

  24. Posted May 24, 2011 at 10:45 pm | Permalink

    Hamranhansenhansen:
    How do u determine the total FaceTime users to be 130 million? I doubt there’s that many iPhone 4 users, including all the MacBook air in circulation.

  25. DaveD
    Posted May 25, 2011 at 12:50 am | Permalink

    First off, Jean-Louis Gassée THANK YOU (or whoever) who doesn’t insist on FB or Twitter accounts or whatever just to comment on a damn post. I am more than willing to have an “online ID” but not when it’s forced to be with the giant – and they ARE giant – ID collectors.

    Back from OT – @Hamranhansenhansen… very interesting take. I disagree on a coupe of [maybe] minor points though. Let’s see if they add up to simple clarification or that you are too young to have lived through some things that at least color opinion (and at most matter).

    “In the 80’s and 90’s, the knock on Apple was that they should license their operating system to compete with Microsoft….”

    Actually it wasn’t. Narrow it down to mid to late 90s and you might be more accurate. Nobody was complaining about licensing Pro DOS (prevalent Apple OS until late 80s or early 90s) and I don’t recall anything about Mac OS either until the mid-90s.

    As for competing with Microsoft?

    “Microsoft is still trying to redo their inheritance of the IBM monopoly and prove Bill Gates right….”

    Please. Please? Can we be historically correct? At least in timing if not personnel?

    The IBM “monopoly” certainly lasted well into the late 1980s. Microsoft NEVER “inherited” it – they (shrewdly) dealt their way into it because IBM never saw the value in it. And Bill Gates? Okay, you got me there – but his role in any of this was early 1980s. (And Office – the only other product to make serious revenue and profits was early 1990s.)

    You give Microsoft WAY too much credit for their part in what is “personal computer” history. Both in timeline and in achievements.

  26. Xynta_Man
    Posted May 25, 2011 at 2:16 am | Permalink

    Zammael, well the number could certainly be true. Facetime can be used on iPhone 4, iPod Touch 4G and Mac OS computers. In a 6-12 month we will probably also see a Windows client, which will certainly make Facetime even more popular. So, who knows?

    Shaun, I don’t think that there is less interest in developing for WP than Symbian – it certainly looks different, when you look at the mobile development landscape. Ask any mobile developer, developing for Symbian was a nightmare, while developing for WP7 is a piece of cake, hence the fastest growing application base.

  27. Bob S
    Posted May 25, 2011 at 5:40 am | Permalink

    Trés intéressant. But I think Nokia’s premium would make too big an egg to swallow, even for Microsoft.

  28. Shaun
    Posted May 25, 2011 at 10:16 am | Permalink

    Xynta_Man, that’s not what I or others are hearing from developers. It may be true in the US perhaps but not in Europe where developers are putting Windows Phone plans on hold after much lower than expected sales in Europe. Sony Ericsson have shelved plans also.

    Symbian development wasn’t that much of a ‘nightmare’ and with Qt it’s pretty damn simple really. It’s such a pity Nokia have bailed out right when their investments were showing promise.

  29. Kurt Usen
    Posted May 25, 2011 at 11:31 am | Permalink

    @Xynta_Man, WP development _is_ a nightmare. For any other platform you have a quick development path: port application C/C++ engine and create platform-specific UI. For WP you need to port _everything_ to Silverlight (C#) from scratch. Who will be crazy enough to invest that much development efforts in such unproven platform? (Even ‘Angry Birds’ are still not available :)

  30. Posted June 13, 2011 at 6:53 am | Permalink

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  31. Posted June 16, 2011 at 5:33 pm | Permalink

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