EditorsAbout the SiteComes vs. MicrosoftUsing This Web SiteSite ArchivesCredibility IndexOOXMLOpenDocumentPatentsNovellNews DigestSite NewsRSS

01.07.09

Hard Week for Microsoft, Next Week Likely Harder

Posted in Finance, Microsoft, Rumour at 9:05 pm by Dr. Roy Schestowitz

Stock Dives

In what seems like a worthy punishment, Intel and Microsoft both suffered a major blow at the sight of stagnant sales.

Shares of Microsoft Corp., the world’s largest software maker, sank Wednesday after chip maker Intel Corp. said fourth-quarter sales missed already lowered expectations.

Even a music Web site has published an article about the effect of Microsoft’s sharp drop in value.

Rap veteran E-40 is reviewing his stock market options after losing money from shares in software giant Microsoft and his fast food chain Fatburger.

Had it not been for massive buybacks, Microsoft’s shares would be worth a lot less and so would the value of the company (as opposed to its cash reserves that rapidly run out [1, 2, 3, 4, 5]).

Cessation and Deflation

According to numerous reports, Microsoft has poured cold water on expansion plans.

Microsoft has put on hold any interest in further expanding its operations in Seattle because of the deteriorating economy, a spokesman said Tuesday.

Divisions Shutdown

According to this report, Microsoft will soon shut down some gaming divisions.

Reuters and other outlets have reported recently that both Microsoft and Sony will be closing some of their major gaming divisions in early 2009.

Microsoft has already shut down Ensemble Studios, as we mentioned in [1, 2, 3, 4, 5]. Since XBox360 makes a loss per sale, Microsoft is now willing to go as far as suing a bankrupt company.

Microsoft Takes Legal Action Against Woolworths In The UK

It could be called the end of an era, as Woolworths in the United Kingdom has closed it’s doors forever to the public. Amidst the announcement that Woolworths would be shutting down due to bankruptcy, there were the typical “everything must go” sales where the store was practically giving their goods away. Well everyone in the land of the Union Jack must not have got the memo, and Woolworths was left with a ton of overstock, and coincidentally some of that stock happened to be Xbox 360′s. Now Microsoft isn’t just trying to take legal action against Woolworths, or Deliotte who is the administrator of the now defunct retailer, just to crash their party.

This is also covered in:

How low have they sunk? [Clarification 08/01/09: this is in reference to Woolworths]

Layoffs

Some days ago we cited many reports of looming layoffs. There are some newer reports:

Regulation, Finally?

Another interesting report today comes from Satyam, which turns out to be a financial fraud.

Satyam Chief Quits, Admits Faking Financial Results

[...]

In a resignation letter submitted to Satyam’s board, B. Ramalinga Raju said the company’s balance sheet carries inflated bank and cash balances, non-existent accrued interest, understated liabilities, and overstated credit amounts owed to the company.

Satyam and Microsoft have a tight alliance.

It was almost 10 years ago that Bill Parish wrote: “Microsoft’s perspective is best reflected by Bob Herbold, Chief Operating Officer, to whom the CFO reports. Bob very sincerely replied, “Bill, everyone is doing it.” My response was that Microsoft is a leader and that others are now seeking to emulate these fraudulent practices they have legitimized. Naturally Bob was not pleased by this perspective and that was our final conversation.”

It was around the same time that someone from inside Microsoft had already blown the whistle to highlight financial fraud [1, 2].

Nervous lady

Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Digg
  • del.icio.us
  • Reddit
  • co.mments
  • DZone
  • email
  • Google Bookmarks
  • LinkedIn
  • NewsVine
  • Print
  • Technorati
  • TwitThis
  • Facebook

If you liked this post, consider subscribing to the RSS feed or join us now at the IRC channels.

Pages that cross-reference this one

46 Comments

  1. AlexH said,

    January 8, 2009 at 3:20 am

    Gravatar

    JFYI, suing a “bankrupt company” (actually, one that’s in administration – there’s a difference) is extremely common, for pretty obvious reasons.

  2. Roy Schestowitz said,

    January 8, 2009 at 3:42 am

    Gravatar

    Merciless nonetheless. There is a similar story about their bank.

  3. AlexH said,

    January 8, 2009 at 4:29 am

    Gravatar

    How on earth is it merciless? The business is being wound up!

  4. Roy Schestowitz said,

    January 8, 2009 at 4:42 am

    Gravatar

    And Microsoft behaves like a vulture, lurking for victims to peck at.

  5. AlexH said,

    January 8, 2009 at 4:46 am

    Gravatar

    Hang on. Microsoft are the ones owed millions, but EUK is the victim? How does that logic work?!

  6. Roy Schestowitz said,

    January 8, 2009 at 4:56 am

    Gravatar

    I doubt they can pay back. Should Red Hat also sue SCO for a frivolous lawsuit?

  7. AlexH said,

    January 8, 2009 at 5:04 am

    Gravatar

    Er, they’re not suing them for money, Roy.

  8. Roy Schestowitz said,

    January 8, 2009 at 5:17 am

    Gravatar

    Yes, of course.

  9. AlexH said,

    January 8, 2009 at 5:26 am

    Gravatar

    So what’s the actual problem?

  10. Roy Schestowitz said,

    January 8, 2009 at 5:30 am

    Gravatar

    It’s like this incident. It shows weakness.

  11. AlexH said,

    January 8, 2009 at 5:32 am

    Gravatar

    You think any other business which had millions of pounds of stock in someone else’s hands wouldn’t take legal action to get it back?

    I think you’re confusing weakness with basic business sense…

  12. Roy Schestowitz said,

    January 8, 2009 at 5:45 am

    Gravatar

    Although it’s a stretch, one could argue that Microsoft just wants lots of XBox360s out there, just as it wants lots of (counterfeited) Windows and Office out there. it’s production costs that make a difference though.

  13. AlexH said,

    January 8, 2009 at 5:52 am

    Gravatar

    Well, it obviously wants lots of Xbox360s out there – I’m not sure how that’s relevant though? The stock already exists, MS sent it to EUK and didn’t get paid for it. Now they want it back.

    Microsoft do tonnes of stuff worth criticising, but I just don’t see how this is anything different than normal business practice…

  14. Roy Schestowitz said,

    January 8, 2009 at 6:01 am

    Gravatar

    This was not the main criticism in this post, but you latched onto it. Reread the post to see things in context (it was about shutdown on XBox/gaming divisions)

  15. AlexH said,

    January 8, 2009 at 6:11 am

    Gravatar

    Well, most of the rest is just opinion/speculation.

    This is what I find difficult: sometimes, you justly criticise Microsoft for things they’ve done wrong. But othertimes, you criticise them when they’re doing things anyone else would do (this example, the CSS example, etc. etc.). Often, you criticise them for doing things that others are doing (e.g., the continual illogic about stock buy-backs).

    It makes it impossible to separate the valid criticism from the made-up “it’s bad because Microsoft are doing it”. We’re to believe that Microsoft have “sunk low” because they’re trying to recover debts? Give me a break.

  16. Roy Schestowitz said,

    January 8, 2009 at 6:29 am

    Gravatar

    That was Woolworths, not Microsoft.

  17. AlexH said,

    January 8, 2009 at 6:36 am

    Gravatar

    What was Woolworths?

  18. Roy Schestowitz said,

    January 8, 2009 at 6:43 am

    Gravatar

    Sinking.

  19. AlexH said,

    January 8, 2009 at 6:51 am

    Gravatar

    Perhaps you ought to correct the article then, because you’re talking about Microsoft and switch to Woolworths without noting it.

  20. Roy Schestowitz said,

    January 8, 2009 at 6:53 am

    Gravatar

    I’ve added the word “Woolworths”.

  21. AlexH said,

    January 8, 2009 at 6:55 am

    Gravatar

    Given you already called them “bankrupt” (which they’re not), why do we care how low Woolworths have sunk? Can you get any lower?

  22. Roy Schestowitz said,

    January 8, 2009 at 7:01 am

    Gravatar

    “Amidst the announcement that Woolworths would be shutting down due to bankruptcy,”

    http://www.talkxbox.com/article2981.html

    I cited it.

  23. AlexH said,

    January 8, 2009 at 7:03 am

    Gravatar

    “Bankrupt” is past tense. Woolworths are currently in adminstration.

    And anyway, it’s not Woolworths, it’s EUK, who are still trading and probably won’t go bankrupt (particularly since they’re part owned by the BBC).

  24. Roy Schestowitz said,

    January 8, 2009 at 7:06 am

    Gravatar

    Good for them.

  25. AlexH said,

    January 8, 2009 at 7:07 am

    Gravatar

    Bravo on rewriting it in ambiguous fashion again, anyway.

  26. Roy Schestowitz said,

    January 8, 2009 at 7:12 am

    Gravatar

    it wasn’t intended to be ambiguous.

  27. AlexH said,

    January 8, 2009 at 7:13 am

    Gravatar

    The simpler fix would be to cross out “they” and put “Woolworths”.

  28. Roy Schestowitz said,

    January 8, 2009 at 7:18 am

    Gravatar

    I didn’t want to use strikeout but rather just to clarify.

    Do you really have nothing better to comment on? I’ve posted some interesting things, but nitpicking appeals to you much more.

  29. AlexH said,

    January 8, 2009 at 7:28 am

    Gravatar

    No, it’s not the nitpicking, it’s watching the revisionism in action – how far you’ll bend to not admit a mistake.

  30. Roy Schestowitz said,

    January 8, 2009 at 7:34 am

    Gravatar

    If you are a perfectionist, use an encyclopedia or contribute to Wikipedia. If my source says that “…Amidst the announcement that Woolworths would be shutting down due to bankruptcy,” then I am allowed to innocently propagate an error every now and then.

    I write many posts here. Precision is hard when some of the articles from Google News are erroneous.

    If you have a nitpicking hobby, start a(nother) blog and express your point of view.

  31. AlexH said,

    January 8, 2009 at 7:35 am

    Gravatar

    You’re missing out the main point, which isn’t about your mistakes. It’s the made-up criticism that’s the big problem.

  32. Roy Schestowitz said,

    January 8, 2009 at 8:06 am

    Gravatar

    Of who? Woolworths? There is no criticism there; this part is pointing out that XBox360 is failing.

  33. AlexH said,

    January 8, 2009 at 8:16 am

    Gravatar

    The XBox360 isn’t failing in anyone’s eyes except yours, because you still repeat the “loss on every sale” meme, which as has been pointed out isn’t true any more.

    But I articulated my point many comments ago: you criticise Microsoft for many things. Some of them are entirely justifiable, and deserve wider notice. But then you pepper it with nonsense about CSS vendor extensions or (in this case) claiming back their own property, and start calling them names.

    By making bad points you drown out the good ones.

  34. Roy Schestowitz said,

    January 8, 2009 at 8:27 am

    Gravatar

    Ballmer himself calls XBox a “funny product” because they’ve lost billions on it. How do you define success? Number of adverts?

    The only winner is Nintendo, which Microsoft prefers to pretend does not exist.

  35. AlexH said,

    January 8, 2009 at 8:35 am

    Gravatar

    Not being #1 doesn’t make it unsuccessful. Having a huge installed base, a lot of subscribers, and a profitable business counts as “success” (and they are profitable now).

    You write Microsoft off at your peril. Seriously.

  36. Roy Schestowitz said,

    January 8, 2009 at 8:39 am

    Gravatar

    They are not profitable. They have lost about $7 billion. They are at the point now where they no longer lose even more money (that’s what they claim anyway), but it doesn’t make them “profitable”.

  37. AlexH said,

    January 8, 2009 at 8:50 am

    Gravatar

    Actually, it does. Profitability is over a financial period, not the entire lifetime of any given product. By your logic, Windows will be a profitable product basically forever.

  38. Roy Schestowitz said,

    January 8, 2009 at 8:54 am

    Gravatar

    You are attempting to spin this.

    Let me simplify this. Let us say that Microsoft’s balance-sheet for XBox looks like this:

    2000: -$1,000,000
    2001: -$1,500,000
    2002: -$1,400,000
    2003: -$2,000,000
    2004: -$2,000,000
    2005: -$2,500,000
    2006: -$4,000,000
    2007: -$7,500,000
    2008: -$7,200,000
    2009: ?? (2009 depression)

    Does that look like a successful and profitable business?

  39. AlexH said,

    January 8, 2009 at 8:56 am

    Gravatar

    As I just said, the concept of profitability is not a cumulative one for obvious reasons. No-one measures it like that.

    Call it spin if you like; it’s actually Finance 101. Go read how actual accountants do this, Roy.

  40. Roy Schestowitz said,

    January 8, 2009 at 9:07 am

    Gravatar

    ‘Pedancy’ with literal meanings does not change the fact it is a piker from a financial perspective,

  41. AlexH said,

    January 8, 2009 at 9:15 am

    Gravatar

    It’s not pedancy, Roy. You can’t redefine “profitability” to your own term just because it suits your argument.

    This is a classic example of what I’m saying. Microsoft (and, to a lesser extent, Sony) have massively subsidized their entry into this market. That’s fair enough criticism.

    But then you over-egg the pudding by basically padding it with fabrication. You repeat old memes which are no longer true, and meddle around with words.

  42. Roy Schestowitz said,

    January 8, 2009 at 9:17 am

    Gravatar

    Which memes? Be specific, please. Subsidy of entry does not mean that a product will not generate a loss throughout its lifetime.

  43. Dan O'Brian said,

    January 8, 2009 at 9:32 am

    Gravatar

    Roy: go out and get some real-world experience, please, before you further humiliate yourself.

    Actually, on second thought, it’s more funny if you don’t.

  44. Roy Schestowitz said,

    January 8, 2009 at 9:34 am

    Gravatar

    Dan,

    Your message lacks content.

  45. AlexH said,

    January 8, 2009 at 9:43 am

    Gravatar

    I’m sure he can make something up if you give him a few minutes.

  46. Dan O'Brian said,

    January 8, 2009 at 10:19 am

    Gravatar

    His faulty intepretation of the “Linux Heat Map” is a great example. His lack of understanding in this article is yet another.

    The list is endless.

What Else is New


  1. Rumour: EPO in Berlin the Next Casualty of Battistelli's 'Reform' (Organisational Suicide Plan)

    Months after we learned that a former staff representative in Berlin had been dismissed we come across an anonymous claim that Berlin's 'branch' of the EPO will be folded onto Munich's



  2. Caricature: the Maas App

    The failure of Maas to even bother with regulation of Battistelli (among others) earns him this cartoon



  3. Links 5/12/2016: Linux 4.9 RC 8, DeepMind as FOSS

    Links for the day



  4. Leaked: Battistelli Acknowledges Bunk 'Justice' in About 100 Cases at the Internal Appeals Committee of the EPO

    A look at Battistelli's response to the latest from the International Labour Organisation (ILO), exceptionally delivering two decisions at the very end of last month



  5. The UPC Scam Part V: Unitary Patent Regime a Fantasy of Patent Trolls

    "Good for trolls" is a good way to sum up the Unitary Patent, which would give litigators plenty of business (defendants and plaintiffs, plus commissions on high claims of damages) if it ever became a reality



  6. EPO at a Tipping Point: Battistelli Quarrelling With French Politicians, Administrative Council Urged to Act, Staff Unrest Peaking

    The latest messages about Battistelli's regime at the EPO, which faces growing opposition from more directions than ever before



  7. Quality of Patents at the EPO Dependent on the Appeal Boards When Battistelli Assesses Performance Using the Wrong 'Production' Yardstick

    A look at some recent articles regarding patent quality in the US and in Europe, in particular because of growing trouble at today's EPO, which marginalises the appeal boards



  8. Microsoft's Push for Software Patents Another Reminder That There is No 'New' Microsoft

    Microsoft's continued fascination with and participation in the effort to undermine Alice so as to make software patents, which the company uses to blackmail GNU/Linux vendors, widely acceptable and applicable again



  9. Links 5/12/2016: SparkyLinux 4.5 Released, Kondik Exits Cyanogen (Destroyed After Microsoft Deal)

    Links for the day



  10. Software Patents Continue Their Invalidation Process, But Patent Law Firms Try to Deny This in Order to Attract Misinformed (or Poorly-Informed) Clients

    A roundup of news about software patents and demonstration of the sheer bias in the media, which is mostly controlled or steered by the patent microcosm rather than actual inventors



  11. Patent Trolls of Microsoft and Ericsson Are Trying to Tax Everything, Especially Linux Devices

    An update on Intellectual Ventures and Unwired Planet, whose operations pose a growing problem for Free software and Linux-based products (e.g. Android)



  12. Asia's Patent Litigation Chaos Getting Worse, Reaching Countries in the West, and Sites Like IAM Actively Promote This

    The race to the bottom (of patent quality) in China, the growth of patent trolls in the region, and the ruinous litigation strategy which now spills over even to the US -- through the Eastern District of Texas -- and may inevitably come to Europe (especially if the UPC ever becomes a reality)



  13. More French Politicians Are Complaining That Benoît Battistelli is a Disgrace to France and Urge for Action

    The backlash against Battistelli spills well outside the EPO and is now apparent even at the French National Assembly



  14. Links 3/12/2016: Mageia 5.1 Released, Mozilla Revenue at $421.3M

    Links for the day



  15. Canadian Intellectual Property Office (CIPO) Sees Decline in Patent Applications and It May Actually be a Good Thing

    Challenging the false belief that the more patents society has the better off it will be, citing examples and news from north America



  16. Blockchain Domain Infested With Software Patents, MasterCard Among the Culprits

    Worrying signs that an area of Free/Open Source software innovation is getting impacted by the plague of software patents



  17. Dutch Media Covers Latest EPO Scandals, German Media Totally Absent (a Media Blackout of Convenience)

    Our observations regarding the apparent media disinterest in EPO scandals, especially at the very core of the EPO (principal host country)



  18. Relocating the Boards of Appeal to Haar is a Poisonous Priority at Battistelli's EPO

    Revisiting Battistelli's effort to chop off the appeal boards that are necessary for ensuring patent quality at the EPO



  19. Links 2/12/2016: Mint Betas, Chrome 55, KDevelop 5.0.3, PHP 7.1.0

    Links for the day



  20. The Rule of Law and Justice Don't Exist Inside the EPO, Confirms the International Labour Organisation (ILO)

    Further analysis of the latest rulings from the ILO -- decisions that were long expected



  21. A Day in the Life of... Battistelli's Banana Republic

    This is part 5 of a fictional diary from the EPO



  22. Links 1/12/2016: Devuan Beta, R3 Liberates Code

    Links for the day



  23. Two ILO Decisions on EPO Cases Are Released, at Least One Judgment is Considered Good for Staff

    Years later (as justice is too slow, partly because of the EPO, being the principal culprit that clogs up the ILO's tribunal system) there is a couple of new judgments about EPO abuses against staff



  24. Dutch and French Politicians Complain About the European Patent Office, British Media Coverage Regular Now

    Pressure from the political systems, the scientific community and from the media is growing, as it becomes abundantly apparent that the EPO cannot go on like this



  25. Links 30/11/2016: Git 2.11, GOG Surprise Tomorrow

    Links for the day



  26. The UPC Scam Part IV: Bumps Along the Road for UPC, With or Without the UK and Brexit

    A sobering reality check regarding the UPC, no matter what Lucy Neville-Rolfe says under pressure from Battistelli and some selfish law firms that are based in London



  27. The UPC Scam Part III: The “Patent Mafia”

    Bigwigs like Lucy Neville-Rolfe and Benoît Battistelli, together with Team UPC and its tiny minority interests (self enrichment), are conspiring to hijack the laws of Europe, doing so across many national borders with unique and locally-steered patent policy in one fell swoop



  28. The UPC Scam Part II: The Patent Echo Chamber at Work, Prematurely Congratulating Itself in Its 'News' Sites





  29. The UPC Scam Part I: EPO-Bribed Media Outlets Lie to Brits (and to Europeans) About the UPC

    An introductory article in a multi-part series about UPC at times of Brexit and Lucy Neville-Rolfe's bizarre sellout to Battistelli



  30. European Public Service Union Asks EPO Administrative Council “to Re-establish the Rule of Law at the European Patent Office”

    The chinchillas of the Administrative Council are assertively asked to tackle the abusive management of the EPO, which gets condemned not only by CERN but also EPSU, which is working with the Dutch government to end lawlessness at the EPO


CoPilotCo

RSS 64x64RSS Feed: subscribe to the RSS feed for regular updates

Home iconSite Wiki: You can improve this site by helping the extension of the site's content

Home iconSite Home: Background about the site and some key features in the front page

Chat iconIRC Channel: Come and chat with us in real time

CoPilotCo

Recent Posts