What’s eating Microsoft?

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I couldn’t help but notice stories about Microsoft’s direction and management team recently notably hedge fund manager David Einhorn’s call for Steve Ballmer to resign as CEO; and decided to look at things from a slightly different data point: Google’s Insights for Search which is a reasonable proxy for levels of interest amongst the general public about a brand.

Microsoft and Apple

The general trend of their being an increase in Apple and a decrease in the interest in Microsoft was not a surprise. What did surprise me was, given all the hype about Apple how slow and steady the increase in interest was in the brand. It goes to show that media and online discussion take a while to move opinions, what they have done is allow them discussions to take place in the general public and give Apple a chance to be part of the evoked set. The insight also shows which countries have a higher than normal interest in the search term.

Ranking in terms of regional interestMicrosoftApple
1Papua New GuineaHong Kong
8CambodiaNew Zealand

What’s immediately apparent from this chart is that Microsoft has the highest interest in countries that have the least disposable income to pay for software. So it becomes a volume business as margins have to be kept thin to make the market.
Comparing Microsoft and IT bellweather company IBM, is a good way to understanding how interest for the software giant stands in its heartland of enterprise IT. What we see in this graph is that The decline in interest about Microsoft mirrors the gradient of the IBM line indicating that this decline in interest may be sector related rather than specific company-related.

If this graph had been brought out during the Microsoft – Yahoo! hostile takeover discussions; the logic of a deal may have been more obvious; even if the operation and financial aspects would have been bad for both brands. Being able to combine the level of interest in both Yahoo! and Microsoft would bring it within striking distance of Google. However what looks good on a graph curve doesn’t often make sense in reality.