This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Microsoft's Mid-Life Crisis

NEW YORK ( TheStreet) -- After Thomas Watson Jr. retired from IBM, the company spent nearly two decades in drift, becoming vulnerable to the first "kid with a clue" who came along.

Fellow named Gates.

Now the generational shoe is on the other foot. Microsoft (MSFT - Get Report) is going through its own mid-life crisis. Under Gates' successor, classmate Steve Ballmer, Microsoft has gone through strategies the way a Bloomingdale's shopper goes through sweaters.

Ballmer told ReadWriteWeb recently Microsoft will now become a consumer hardware company, building its own lines of tablets and game machines. This just as it prepares to bet the company on Windows 8, which depends heavily on hardware partners for its success.

Being closer to 60 than 50 myself, this next sentence is hard to write. What Microsoft needs to do most is to get younger.

As Yankee Group founder Howard Anderson wrote recently at Information Week, Microsoft is now 37. The problem is that most top managers joined near that founding, when analysts complained the company needed "adult supervision."

Anderson identifies Microsoft's problem as "hubris," the idea that it's bulletproof. Its cloud still wins in surveys of developers, as Information Week reports.. Its Surface tablet may be priced competitively with the Apple iPad, as Business Insider notes.

That's not good enough.

Here is something I've told my kids since they were little. My father's generation created TV, but my generation defined it. My generation created the Internet, but your generation will define it.

Only by growing up with something, and taking it for granted, can you really see its flaws. My kids grew up with the Internet as a normal part of their lives. They see its flaws more clearly than I do.

Microsoft today is a disparate collection of businesses, all led by guys my age and even older. Microsoft has lost the hunger and is just hanging on, trying to tweak what the industry's leaders have and patenting it, going off in all sorts of directions.

Microsoft needs to trust someone under 30.

The PC and Internet eras look mature to us geezers, as I'm sure TV looked mature to the old men running it in the 1970s. But it was just starting. Young entrepreneurs like Ted Turner were just then thinking about how to transform it, with satellites, into 500 channels of nothing-on, turning broadcasting into narrowcasting.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
MSFT $49.99 0.24%
AAPL $93.07 -0.59%
FB $117.97 -0.08%
GOOG $701.78 0.87%
TSLA $213.15 -4.20%


Chart of I:DJI
DOW 17,635.55 -15.71 -0.09%
S&P 500 2,049.63 -1.49 -0.07%
NASDAQ 4,720.37 -5.2690 -0.11%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs