Wednesday, 19 October 2011

The Losing Battle

As HP wonders what to do next with what, Lenovo and Dell worry about low margin products, RIM tries to clear up its messes, Acer looks slack-jawed at its continued fall, Google and Apple just go on and on.

And then some.

But Wall St is a funny place as even a staggering 85% increase in profits to $25.9bn this year sent the shares down 5% in value. I dare say that analysts will be asking if such dizzy heights in terms of growth can ever be achieved again - particularly after the passing of Steve Jobs. Yet, the iPhone 'franchise' continues to deliver as the new 4S got a massive tick in the box with pre-orders of 4m while the version 5 is just around the corner.

The only shadow on the whole thing was that iPad sales slowed considerably as only 11m were sold when everyone had expected 20m would be in the final quarter. In terms of computer, Apple Mac sold 4.9m models up 27% over the same period last year. That growth was achieved while the PC market went backwards at a rate of knots.

There is no doubt that Wall St expects more of even the Golden Goose and that's its problem not Apple's. These figures were stunning.

I mentioned Google's near $10bn sales quarter recently. Inside the numbers was an interesting story as Gartner Group now estimate that 0.5% of the revenue is contributed to by Google Apps for Business sales.

Trivial in the great scheme of things, eh? That tiny percentage represents $50m of sales last quarter, $136m in the 9 months to that date, $200m annualised right now. These sales are of a simple set of Apps priced flatly at $50 per user per annum.

This is the 'noise' that Microsoft refers to. You could suggest that Google might have expected around $100m of those sales to have been achieved in Europe - after all, some 450,000 teachers have standardised on Google Apps for Business in Morocco alone, according to the numbers. 

If those numbers from the independent Gartner are right then Google are completely outselling Microsoft globally on Microsoft Office 365 - and by an order of magnitude in Europe in terms of both sales and licences sold.

The noise is getting somewhat louder.

The world of the Cloud is changing us very quickly as Apple released its iCloud and Google sells its Apps. As Tom Austin, Gartner's Analysts who put the figures together in noting that small businesses are now 'flocking' to Google, said 'It's Microsoft's game to lose'.

I would say with its current strategy, Microsoft are making a good fist of losing this battle.

No comments: