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IT Services and Microsoft: An Introduction

IT Services and Microsoft: An Introduction. Wendy(Di) Wang. IT Services. Industry competition. licensed-based proprietary software model third-party advertising: providing free applications, online services and content. Buyer power. Supplier power. Product substitutes . Threat of entry.

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IT Services and Microsoft: An Introduction

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  1. IT Services and Microsoft: An Introduction Wendy(Di) Wang

  2. IT Services

  3. Industry competition • licensed-based proprietary software model • third-party advertising: providing free applications, online services and content

  4. Buyer power

  5. Supplier power

  6. Product substitutes

  7. Threat of entry

  8. S O • Brand reputation • Brand loyalty • User-friendly products • Strong distribution channels • Sufficient financial resourcesfor R&D • Talented workforce attracted by offering broad customer reach, scale in resources, and competitive compensation • Providing services for enterprises • Developing new form factors that have increasingly natural ways to use them • Applying machine learning to make technology more intuitive • Building and running cloud-based services • Establishing theWindows platform across the PC, tablet, phone, server, and cloud W T • Slow innovation • Dependency on hardware manufacturers • Weak in the search engine market • Poor M&A strategy • Lawsuits • Traditional businesses in a period of transition • Customer preference evolves rapidly

  9. Strengths • Brand reputation • --named as the company with the best reputation for CSR for the 2nd year • Brand loyalty • --92% of the desktop operating system market share • Strong distribution channels • --OEM(original equipment manufacturers) pre-install software on new PCs, smart phones, and other intelligent devices that are sold to end customers • --distributors and resellers • Enterprise Software Advisors: solution integrators, independent software vendors, web agencies, and developers that advise organizations on licensing Microsoft’s products and services • LARs: organizations license products and services indirectly through large account resellers, distributors, value-added resellers, system builder channels and retailers • --online • average consumers: through Bing, MSN portals and channels, etc. • business users: Microsoft Online Services platform, which includes cloud-based services such as Business Productivity Online Standard Suite • others: advertising platform with offerings for advertisers

  10. weaknesses • Slow innovation • --ex-CEO Gates admit that Microsoft failed to "get out in the lead very early" in the mobile market, labeling the way the company developed its mobile products later than others as "clearly a mistake" --missed the opportunity to be the first player in online advertising • Dependency on hardware manufacturers • --depends on computer hardware manufacturers to develop products that run Windows Operating System • Poor M&A strategy • --in 1997, Microsoft purchased Seattle-based aQuantivefor $6.3 billion in cash— at the time the largest acquisition in the software giant’s history • --five years later in 2002, Microsoft took a $6.2 billion writedown, largely tied to aQuantive • --“the acquisition did not accelerate growth to the degree anticipated”

  11. opportunities • Providing services for enterprises • --businesses look to Microsoft’s business applications like Microsoft Dynamics, Office, Exchange, SharePoint, Lync, Yammer, and its business intelligence solutions • Developing new form factors that have increasingly natural ways to use them • --including touch, gesture, and speech • Establishing Windows platform across the PC, tablet, phone, server, and cloud • --delivering seamless services and experiences across devices • --e.g. Windows 8: designed to unite the light, thin, and convenient aspects of a tablet with the power of a PC

  12. threats • Lawsuits • -- alarge number of antitrust and unfair competition class action lawsuits filed against Microsoft in various state, federal, and Canadian courts on behalf of various classes of direct and indirect purchasers of its PC operating system and certain other software products between 1999 and 2005 • --patent and intellectual property claims • Traditional businesses are in a period of transition • -- Windows operating system • -- competitors are developing new devices, services, and platforms • Customer preference evolves rapidly • -- cloud-based services

  13. Sources • “Porter’s Five Forces Model” • https://sites.google.com/site/computerindustryadmn703/home/porter-s-five-forces-model • “After the writedown: How Microsoft squandered its $6.3B buy of ad giant aQuantive” • http://www.geekwire.com/2012/writedown-microsoft-squandered-62b-purchase-ad-giant-aquantive/

  14. Thank you

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