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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Mathemagician who wrote (48024)	10/18/2001 4:02:11 AM
From: techreports	Read Replies (2) \| Respond to of 54805

i wrote: I really don't think Microsoft's hold on the OS market is THAT strong. I mean, I could see Windows w/ say 80% share if someone offered a OS that was decent and ran on x86 processors. mathemagician wrote: That's what IBM thought. Remember OS/2? Let me rephrase that. I could see Windows w/ say 80% share if someone offered a OS that was decent and ran Windows applications and ran on a x86 processor. I don't think OS/2 ran Windows applications. Hmm...it might have for awhile, but then Microsoft took away that right if I remember correctly. You are also forgetting a few things between when IBM offered OS/2 and today. 1) the internet is more important. If you want a computer to surf the internet, then you don't need Windows. 2) Microsoft's grip on the OEMs is much weaker than it was when IBM was pushing OS/2 3) A small group of linux programers have created a program that allows linux to run Windows applications. Last I heard, they could run many Windows applications. It wasn't perfect, but wasn't bad. The 3 reasons above is why I feel Microsoft's hold is weaker and could allow a company to take significant market share. Then again, I thought eBay was doomed, because Amazon and Yahoo offered the same service for free. Still, my concern with eBay was a reasonable fear IMO. eBay's expensive stock alone was enough to be bearish on the company. With Yahoo and Amazon charging now and eBay raising prices, I've decided that their is enough history and proof that eBay should be able to with-stand any further competition. I do have a small concern that Aol will start their own auction service and promote it heavily to their users. I mean, what's to stop Aol from not letting users goto ebay.com and possibility sending them to their own service? Will eBay complain? Probably. Will this make a lot of people unhappy? Probably. Does this mean Aol wouldn't try a move like this? No, i don't think so.. As for right now, eBay and Aol are partners, so I don't worry about it too much. Plus, eBay is a global company. Really? Microsoft has an unbelievable set of competitive advantages - probably more that any other company in any market. It is good to keep this in mind while tracking the J2EE vs. .NET market as it develops. Again, read above. I think someone could take 20% of the PC OS market. Unless Microsoft goes back to their dirt ways, changes the Windows APIs and starts throwing a ton of money on putting this OS company out of business as well as using their patents in court to slow the company down. Another favorite trick Microsoft uses is to start hiring employees from their competitors. Eventually the brain drain takes effect. I just think it is much easier than most think. Does that mean Microsoft can't make it tough again? No. My point is, as of right now, I think it is possible. Especially if a company like Sun does this since they have the cash to fight a free OS war. Does he ever re-evaluate that expectation? From the following chart, it's obvious that KO's valuation rose to unsustainable levels in early '98. Wouldn't it have made sense for him to sell when it got out of line, hold the cash, then buy an even larger percentage of the business in the first quarter of 2000 when the KO's bubble burst? KO is a special case with Buffett. He usually sell stock when his stocks become overvalued. Buffett does sell! But with KO he plans on holding. I think it has to do with him being on the board or being friends with management or something. p.s. I'm still wondering why no soft drink company has produced a cola that tastes exactly like Coke? Is it really that hard?