Originally Posted by Dr Millmoss
It's never been important to Microsoft in the past. The way this dysfunctional industry works has always been advantageous to Microsoft. They've been able to play the OEMs off against each other. If one OEM goes under, another takes its place. Why should they care?
I don't think this is true. MS saw the threat of the web 15 years ago and is the reason they shut down Netscape. The web is platform agnostic and MS wants the consumer electronics industry to revolve around Windows. Once Internet Explorer controlled over 90% of the web, MS essentially went to sleep on further advancement of the web.
I don't believe MS is that detached from the OEMs. If HP or Dell goes out of business could have a huge impact on MS sales. What other business can you think of that doesn't care if its clients go out of business or not.
Or the industry could continue to consolidate, as it has been doing for the last ten years or so. Chrome could become an alternative, but it's far too soon to put any stock in it. If it's any indication, the industry has had Linux available for decades but it has so far failed to give the OEMs a significant alternative to Windows to sell to their customers.
The industry has consolidated because there has been no viable alternative to Windows. Once an OEM hit rock bottom in selling cheap PC's, their was no where else for it to go. This can only last for so long. Eventually some OEM is going to be smart enough to not follow the PC death spiral of its predecessors, and figure out an alternative.
Chrome OS is coming at the problem from an entirely different direction, Google isn't making the same mistakes that Linux has made. Whether Chrome OS is going to work or not remains to be seen. But it is finding the relationship between MS and its vendors at a fairly vulnerable time.
But for the OEMs, even a free alternative to Windows isn't their ticket out of their bind. They'd still be making and selling commodity hardware, able to distinguish themselves from the competition mainly on price, which is what has always fueled the race to the bottom. By contrast, Apple has the opportunity to describe how the entire product works -- this is Apple's advantage. This is how they get value added. The OEMs can't duplicate it.
I agree even if Chrome OS does become a viable alternative OEMs will still have to work to distinguish themselves from other OEMs. But that's the same case with any competitors who offer the same product.
But my main point was that MS does care if its vendors are profitable. Because if they are not they will either go out of business or will be forced to find an alternative. Neither situation is good for MS.
The Windows OEM business has always stunk. In the past, the basic problem with the industry was papered over by many years of double digit unit growth. No more, maybe never again. Now everybody knows that the Windows OEM business stinks.
Well double digit group was all they needed when most people didn't yet own computers. Now that the computer market is quickly becoming saturated, they will have to innovate a new business model. Which is my point a new business model likely would not include Windows.