Or select individually:
- How Microsoft Lost Its Mojo
- In Case You Had Any Doubts About Where AOL’s Revenue Comes From
- Online Advertising Is Back, Baby!
- Facebook Is Absolutely Crushing The Competition
- Apple’s Gaming Platform In Context
Good thing! For a while there, Microsoft was barely doing anything to excite people.
The reason Microsoft lost its mojo? It was being hounded by the anti-trust cops between 2004 and 2007, says Jefferies analyst Katherine Egbert. During that period, it racked up ~$2.5 billion in fines.
For the 2005 fiscal year, R&D spending as percentage of revenue dropped 22% year-over-year. Between 2004 and 2007, Microsoft's R&D as per cent of revenue fell below 15%. The average R&D as per cent of revenue for the software industry is 16%.
With anti-trust issues in the rearview mirror, Microsoft is raising R&D spending. It can revert to its old-school strategy: Follow someone else's lead, then decimate them, says Katherine.
Of course, the world after 2004 looks a lot different than the one before it. Apple is fast becoming the most important mobile company in the world. Google owns search. Facebook is the new home on the Web.
Further, Google and Apple have pockets almost as deep as Microsoft, meaning it's far from a sure thing that Microsoft's old playbook will still work.
AOL's content strategy is a mess, which needs to be fixed soon.
As you can see in the chart below, AOL has been buoyed by its ISP subscription business for years, but that business is dying. And fast.
In March 2007, the subscription business was generating $873 million in revenue. In the December, it was only generating $307 million.
Meanwhile, the advertising business, which is supposed to be AOL's future, also dropped over the same time period. Display advertising ticked up slightly in the last quarter on a sequential basis.
However, it needs to show big gains if Tim Armstrong wants to keep all his new hires happy.
After getting rocked from the financial crisis, online advertising has bounced back.
The Interactive Advertising Bureau released data today showing online advertising for the fourth quarter of 2009 totaled $6.3 billion, a record for quarterly spending.
For the full year, online advertising fell 3.4%. However, the last quarter's improvement shows 'the worst of the economic impact on internet advertising is over and that the seeds of growth have been planted,' David Silverman of PricewaterhouseCoopers says in the IAB's report.
Search advertising accounted for 47% of sales, or $2.96 billion worth. Display was the next big contributor at 23% of sales, or $1.5 billion.
Back in March 2008, Facebook wasn't yet the most popular social network in the world yet. Now, it's crushing everybody. Look at the chart below (from a report on SharesPost): Facebook's popularity is simply on a different scale than its competition's.
Meanwhile, Facebook's ad business is booming thanks to virtual game studios busily acquiring new users and brands marketing their Facebook pages (which let brands spam customers like they use to with email). There's also 'Pay With Facebook' which gives Facebook a 30% cut of the ridiculously fast growing virtual goods market on Facebook AND could end up us a one-click payment option across the Internet.
Apple's mobile gaming platform is huge compared to its rivals. During its iPhone OS 4 presentation Scott Forstall, SVP iPhone software, flashed this slide.
He said, 'If you look at dedicated gaming devices like the Sony PSP and the Nintendo DS, we just blow them out of the water.'
Or choose individually:
- Here's Why The Next Year And A Half Is Critical In The Smartphone Wars
- Apple's Stock Is Kicking Google's Butt
- If You Think Your Mobile Network Is Choking On Data Now, You Ain't Seen Nothing
- Apple Gaining On RIM Fast
- Here's What Microsoft And Apple Need To Do To Beat Google In Search
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