Katie MarsalJackson Turner of Argus Research switched his call on Microsoft from "buy" to "sell" on Thursday and lowered his estimates after determining that the Windows developer could no longer keep hold of the operating system market in the face of recent alternatives.
He sees the early software pioneer as having dismissed the challenges posed by newer, easier to use operating systems, especially in the handheld space where Microsoft hasn't been focusing its full attention. Windows Mobile's relative stasis for the past few years has let Apple's iPhone, Google's Android and other mobile platforms grow quickly without an appropriately serious response.
"We believe Microsoft has misjudged — or more judiciously, has been unable to react swiftly to — the shift towards simpler operating systems on cheaper, more portable devices, including cell phones, smart phones and netbooks," the analyst wrote.
And while it won't be a threat until the second half of 2010, Google's Chrome OS is predicted to be a likely threat in the long run by giving netbook makers a viable, simpler replacement for Windows. It's one of the few real pretenders to Microsoft's throne but is probably the "leading edge" of a larger wave of competitors that should whittle away at the company's once secure lead, Turner added.
The researcher is careful not to paint too dire a picture and insists that Microsoft should still be a very large contender if the prediction bears out. All the same, he maintains that much of the stock market has taken threats to Microsoft too lightly and that the company could see a slow, steady decline without a clear sign that it's learned its lesson.
"We believe that the [market] trend is not in the company’s favor and that many quarters of ebbing tide lay ahead," he said.
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80 Comments
I'l second that
Finally, the beginning of the end....goodbye Ballmer. You toolbag.
"Ebbing tide .... ahead."
Wow. Jackson Turner is going to be famous one day. (In the meantime, he'll get vilified too, I am sure).
MS has no threat of losing their majority dominance with their OS. Even when ChromeOS running on very simpler devices does quickly outgrow other OSes it will still maintain it’s dominance overall and in businesses for a long time to come. MS also won’t be closing its door anytime soon yet I’m sure some will interpret this article as proof of that very occurrence being right around the corner.
Understand the guy isn't saying MS will die. He's telling people with money to invest that you'll get a better return elsewhere. There's a difference.