Hard on the heels of last week's surprise announcement that Microsoft Corporation (MSFT) of Seattle, WA, was to halt further development of the Windows operating system came the announcement that the "boring parts" of the Microsoft software range were to be sold off, leaving Microsoft engineers free to concentrate on the parts "that matter most to the users" and market a low-cost system, dubbed the Ybox, which would "really meet users' needs".
Industry analysts countered this move with skepticism, arguing that the "boring parts" are in fact the company's "crown jewels", essential for the continued growth and profitability of the company.
Steve Ballmer, Microsoft CEO unveiled the new strategy at a developers' conference in Redmond yesterday. His unusual delivery style had delegates scratching their heads in puzzlement as he bounded about the stage for two minutes, incessantly shouting the word "Solitaire". Later in his presentation, he expounded, "When you look at the average Windows user, at home or the office, what are they doing? They're not using Word or Excel. OK, some of them may be using PowerPoint, and taking a couple of weeks to make a presentation on paper tissue usage in the washrooms, but most of them are playing Solitaire. It's the most popular program we've ever produced. That's the basis for the new Microsoft strategy. Our new Ybox, to be introduced for next holiday season, is going to be the best Solitaire platform on this planet, bar none."
The specification for the new Ybox, estimated to ship at a street price of $350 in Q3-4 2005, provisionally includes a 6" LCD screen, 2GB of RAM and a 40GB hard drive. The operating system will be a modified version of Windows Server 2003, and it will ship with one application; Solitaire.
After unveiling a foam mockup of the Y-Box projected design, Ballmer continued his presentation. "As a result of the phenomenal effort we are putting into this product's development, we are halting all work on the Microsoft Office suite, which is now up for sale. If any of you developer guys out there want to buy it, see me at the back of the hall after this presentation's over."
Elmo Futzweiler, of J.Q.Random Software, Inc. a shareware developer of Atari game console emulation software headquartered in Modesto, CA, reportedly took up Ballmer's offer, but brushed off reporters' questions later with a "No comment".
The Gardener Group, an industry analysis service, issued a statement about the announcement later the same day. "Despite the obvious popularity of the Solitaire application, we feel that Microsoft is ignoring the wishes of many users by pursuing this strategy. For example, our studies have shown that viewing and downloading pornography ranks a very close second to the use of Solitaire. We therefore cannot admire Microsoft's recent moves while this need remains unmet.
"In addition, we feel that Word and Excel, boring as they may appear to Mr. Ballmer, still have a place in the workplace and the hearts of IT managers, despite the fact that free superior alternatives such as OpenOffice are easily available. We therefore conclude that the reported sale of the rights to the Office suite to JQR Software is deleterious to Microsoft's continued profitability."
Microsoft share prices slipped by 51 cents to $12.67 at the close of trading on the NYSE.