TechWeek: Microsoft Makes Search Sense

In any case, the price isn't material to Microsoft. Even if it were, says Cowen analyst Walter Pritchard, Microsoft needs to open its wallet and start making acquisitions in newer technologies. "In order for MSFT to trade at a higher multiple over the long term, the company must show it will not be left behind by powerful technology trends such as software as a service and advertising-based consumer services." Credit Suisse has a banking relationship with Microsoft; Cowen does not.

That's a great point, but staying abreast of those trends costs money. And Wall Street doesn't always like that. When Microsoft last year announced a $2 billion bump in spending to beef up its lagging Internet units, investors had a hissy fit.

Sorry, but you can't have it both ways.

When Smart Guys Say Dumb Things

Microsoft Chairman Bill Gates, a man of little tact or patience, has been known to wither underlings who don't measure up to his standards of smartness by saying, "That's the stupidest thing I've ever heard." Well, this week Gates let Advertising Age columnist Bob Garfield goad him into saying something incredibly, well, stupid.

According to a transcript of the interview, Garfield asked, "This is based on pretty much zero data, but it doesn't seem to me that either Vista's or Zune's campaign has so far generated a whole lot of buzz. Are they generating any business?"