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Technology Stocks : MSFT Internet Explorer vs. NSCP Navigator

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To: Daniel Schuh who wrote (3287)11/21/1996 2:06:00 PM
From: Reginald Middleton   of 24154
 
<A more general question, though: where, exactly, do Microsoft's earnings go? (besides into cash on hand, of course).>

One obvious answer to that is R&D. In a dynamic and volatile industry like the tech sector, companies are rewarded by institutions (some of tthem at least) for high R&D expenditure if it does not crimp cash flows. On top of that, MSFT really needs to flex its muscle and pull ahead of the crowd if it can, for there is a lot of competition out there, a new paradigm is emerging, and MSFT has increased the fronts on which it is assualting.

BTW, I have no problem in Gerry inquiring about accounting practices, I just don't know the specifics of MSFT's deferral technique (I am sure it is quite creative though)
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