re: Microsoft's worst nightmare coming true

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I just bought a brand new windows 8 PC.

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1. The iPad eats the consumer PC market.

This is happening right now. In the third quarter of 2012, PC sales were down 8 percent on a year-over-year basis worldwide. In the U.S., sales were down 14 percent. A big chunk of the decline can be attributed to the rise of the iPad. Apple sold 14 million iPads last quarter, which is more than the top PC maker, Lenovo, which shipped 13.7 million PCs. Throw in Apple's 4.9 million Macs, and it's the top computer maker by a mile.

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I also don't see many companies leaving Microsoft behind due to the strength of their server software.

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6. Office loses relevance.

Microsoft's Office has been a juggernaut. In fiscal 2012, the Microsoft business division did ~$24 billion in sales.

Last year, we cautioned, "Office runs only on Microsoft platforms and the Mac. As employees start to do more and more work from non-Windows smartphones and iPads, companies may start to question why they're still buying Office for every employee and upgrading it every two or three releases."

The death of Office, has not happened, though. Despite Google's attempt to create Docs, companies aren't giving up on Excel.


7. Microsoft's other business applications start to erode.

If Windows continues to fade, and if Office starts to fade, then corporations have less reason to adopt Microsoft technologies on the back end like Exchange Server for email, SharePoint Server for collaboration, Lync for videoconferencing and real-time communication, and Dynamics for CRM and accounting.

Exchange, SharePoint, and Dynamics all bring in more than $1 billion per year, and Lync is Microsoft's fastest growing business application. Plus, they pull through a lot of other Microsoft products. ...


8. The platform business collapses.

For the last decade, Microsoft's fastest growing business segment has been Server & Tools, which did $7.4 billion in sales last year.

A lot of these sales come because Microsoft business apps — Exchange, SharePoint, and Dynamics — require these products. But as companies stop buying these apps, they will have less reason to buy the Microsoft platform products that run them, and the System Center ($1 billion+) products used to manage them.