Microsoft Just Getting Warmed Up

“On Thursday, the technology industry passes into a new era. It will be fun to watch an unfettered Microsoft battle its biggest rivals. That creaking sound you hear? It’s Microsoft opening the war chest.”

The Skype deal certainly isn’t a small one, and Microsoft has acknowledged that it overpaid for its last biggie, Aquantive.  But the company is about to pass a major milestone, the ten year expiration of its settlement with the DOJ.  They handcuffs are coming off so to speak and Paul McDougall at InformationWeek argues that the Beast is Coming Back.

From his column today:

Under a 2001 settlement, Microsoft agreed to share documentation with rivals and to take other steps to promote the interoperability of Windows with third-party applications…And that’s why Microsoft has been among the least acquisitive big tech vendors over the past decade, and one of the industry’s biggest cash hoarders…

In addition to the $8.5 billion for Skype, Microsoft will pay billions more to Nokia as part of a deal that makes Windows Phone the default OS on Nokia smartphones.

Those moves should serve notice to the rest of the industry that Microsoft is now willing to buy market share in sectors where it’s had a tough time competing through innovation and smart marketing.

I would have much rather seen them do something hyper-aggressive like buy Research in Motion than do either the Nokia deal or this Skype thing.  But whatever, they’re gonna need to spend because we know they can’t innovate.  And spend they will.  At least they’re focusing on mobile/communications – they have the playing field right.

Source:

Skype Buy First Of Many For DOJ-Free Microsoft (InformationWeek)