I was as surprised as anyone when MSFT pulled the bid for Yahoo!. I didn't think that Yahoo! could walk away (and still don't). But the bid from MSFT never really made much sense to me, I never really understood what MSFT got from the deal (and I still don't). Sure they improve their search rankings and gain some content. They get access to the excellent and well-received Yahoo! Finance. But then? It could be a lack of imagination on my part, but I don't see this making MSFT any stronger.
For the longest time I didn't even think that MSFT really had to do anything at all in a timely manner, it is a very entrenched entity with a huge market share in the desktop OS. Sure, things are starting to move off the desktop, but people are creatures of habit and moves off the desktop are going to be a while. And who wants to surf the web on a Motorola Razr anyway?
I was reminded of a case study I studied in grad school that discussed how IBM was able to monitor new entrants to the hard disk drive market and watch to see if new standards took off. IBM started with something like 14" drives, moving to 8" once those took off (and putting the companies who introduced 8" drives into the market out of business in the process) and repeated the process with 5.25" drives and eventually 3.5" drives. I thought MSFT was essentially in the same place, able to monitor developments and adjust accordingly.
Then, something happened that changed my thinking completely. I got an iMac. No, this isn't a Mac-love post (although I do), it's a bye-bye MSFT post. Once I got my Mac, I was off Windows. For browsers I use Safari and Firefox (and had been using Firefox for a while anyway). All of my personal MS Office files? They went either to Open Office or up to Google Docs. Poof! In a day, literally, I was off MSFT products. And there is no reason to go back.
If anything, the Mac is going to be more central to my life than our old PC ever was - it's got a big screen (bigger than our TV) and a remote for watching DVD's, wireless (Bluetooth) keyboard and mouse for improved range, applications galore. This will be the hub that MSFT wishes it was.
So I get it now. MSFT is sitting on a mountain of cash but they are toast, if not now, soon. If not Apple, then Google or some other company we've not heard of yet. The infamous lock-in of the OS and Office are gone. I LIKE being able to access my spreadsheets from anywhere I can get a net connection. I like hardware (and software) that just works. I like, no, I love Gmail. And that's got them panicked. And panicked people make bad decisions - like bidding for Yahoo!
Thoughts?