Larry Ellison's take on whether Microsoft is still relevant | Business

Fortune’s Jon Fortt reports that when long-time Microsoft-basher Larry Ellison (the CEO of Oracle) was asked this week if Microsoft was still relevant, his answer was:

They make a lot of money. I think they’re clearly relevant. I divide the computer industry into two groups. And I know for a long time I was constantly picking a fight with Microsoft. Now Oracle’s constantly picking a fight with IBM. Because you’ve got to pick your enemies very carefully, because you’re destined to become most like those enemies you select.

Microsoft, culturally now, is a very consumer-centric company. They’ve got the Xbox. They’ve got Zune. … I think they are obsessed with Apple (AAPL). They’re obsessed with Google. … Under the new administration at Microsoft, I see all of their energies going into being successful in the consumer space.

Adam Lashinsky, who pointed me to Fortt’s post, says Ellison may be exaggerating a bit (exaggerate? Larry Ellison?!?) but is still onto something. Microsoft’s profits come mostly from business-oriented software (Windows, Office, Outlook, etc.), but its dominance in all those areas is under assault. So it’s been trying to succeed in the consumer space, with limited success and even-more-limited profits. And now Larry Ellison seems to think IBM is the bigger force to reckon with going forward.

That’s two major instances of IBM emulation in a week. What’s up with that?

Stocks Rally Further in Run-up to EU Summit

MOSCOW — Global stocks enjoyed one of their best days in weeks on Tuesday ahead of a summit of European leaders that’s expected to be dominated by calls to boost economic growth.

Europe remains the focus of attention across all financial markets in the run-up to the June 17 Greek election that could go a long way to determining the country’s membership of the euro as well as the future of the single currency zone.

curmudgeon57

It’s certainly an understandable comment by Ellison, but it’s not reflective of Microsoft’s goals. Remember, this is a company that thought it could dominate any market it entered, as long as it got the products right. It came to believe that there was little growth left for it in the business markets, and a decade or so ago started turning to what it believed remained a fast-growth area – consumer electronics. It’s not clear whether they now believe they haven’t gotten the products right yet, or whether it is a quagmire that they can’t win, but either way they can’t retreat and write off all of that investment.

But I wouldn’t under any circumstances call Microsoft a consumer electronics company. It is a marketing company that concentrates on technology.
jomiku

I disagree. I think MS is trying to focus on multiple markets at once because they have the resources to do that and they have real concerns about the future. They were taken largely unaware by the internet – and remember their response put them in the dock with not only our government but all of Europe. They are rightly concerned they can’t see into the future and can’t know what might come at them so they spend money, which they have in abundance, to make sure they’re in those spaces.

As to the Zune, they’ve done a good job of learning from Apple – and let’s be honest, it’s much easier to take someone else’s work and try to refine that – but I’m not sure even they believe the Zune really matters as a music player. I think they have the money* to spend on this small device because they don’t know if that will generate a more existential threat or a bigger opportunity.

*MS is more constrained by talent of all kinds, from writers to managers, than by money. That issue, that it’s hard to manage so many ventures well, may become their biggest problem.