Software giant Microsoft is desperate to find a niche as the industry changes.
For years it has ruled with its OS and Office domination, but it is starting to find that the world has evolved.
Unable to push into mobile, Steve “The Voice” Ballmer appears to be throwing his considerable weight and cash into the steadily growing business software market.
This means that he is signalling an attempt to flatten the expensive German outfit which makes esoteric software which no one understands, SAP and the storage outfit Oracle. There is also Salesforce.com as a rival.
However, Steve feels that he can make a difference and sees gold in them thar hills.
Talking to Reuters, he quietly described himself as “pretty pumped up”, which we feel explains so much.
His theory is that businesses will spend $118 billion a year worldwide on “enterprise applications” by 2014. This is all the dull sort of stuff that never makes the main press. Things like automatic accounting, human resources, sales, supply chains and other stuff which makes storage sound fun. Ballmer thinks that he can give Oracle and SAP a good kicking.
His first effort is a new enterprise resource planning (ERP) software which will soon be accessible online or “in the cloud” for the first time.
There is $21 billion being spent on ERP software and it is likely to rise by five percent a year over the next few years.
Vole has a mountain to climb. It is fifth in the market, behind SAP, Oracle, Sage and IGS.
Redmond needs to get its claws into customer relationship management (CRM) too. This market is worth $10 billion a year and set to grow at around seven percent a year. Vole is doing better in that area. It is coming fourth behind SAP, Oracle and Salesforce.com.
Steve has said that Microsoft Dynamics ERP application will run on its Azure platform, which Microsoft created as the basis for its cloud.
Ballmer’s problem here is that none of these areas are high profile, even if they are lucrative. Vole’s problem isn’t that it is failing to make money. It is just that the world is all excited about mobile at the moment.
Most of the tech press would rather write about printer ribbons than management software. Oracle and SAP hardly got any coverage until Oracle CEO Larry Ellision took HP to court.
Ballmer needs to capture the world’s attention again if he wants share prices to rise and he is not going to do that with management software, even if he succeeds.