Silicon Insider: Disappearing Institutions

Microsoft — Microsoft is so big, so dominant and has been at the top of the electronics industry for so long that it is hard to imagine it ever losing its eminence.

But this week's announcement that "Longhorn," the long-awaited update to its Windows OS, is still two years off is a warning that Microsoft may have begun to lose its edge.

The simple fact is that nobody really likes Windows. It's old and klunky, vulnerable to hacks and viruses, and it acts like a governor on the throttle of the newest generations of high speed processors. But it's the biggest game in town and the safest buy. As people used to say about IBM, nobody ever gets fired for buying Windows.

But the comparison to Big Blue is an apt one, because IBM, like Microsoft the most dominant tech firm of its era, was eventually tripped up by bloated and uncompetitive products, growing customer frustration and the drag of legacy systems. It's not hard to see those same problems growing and festering at Microsoft.

Now Windows users are being told it will be another two years before they can even hope for an upgrade. Will they wait — especially with Linux growing more robust by the day? With Apple likely upgrading its OS twice during that time? And with Microsoft's reputation for being late on everything connected with Windows?

One thing for sure, no one seems scared about Bill Gates and Co. these days.

Michael S. Malone, once called “the Boswell of Silicon Valley,” most recently was editor-at-large of Forbes ASAP magazine. His work as the nation’s first daily high-tech reporter at the San Jose Mercury-News sparked the writing of his critically acclaimed The Big Score: The Billion Dollar Story of Silicon Valley, which went on to become a public TV series. He has written several other highly praised business books and a novel about Silicon Valley, where he was raised.

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