The Cost of "Integrated Innovation"

Earlier this week, Jupiter Research published my report, "Microsoft's Integrated Innovation: Weighing up Customer Benefits, Risks." The report looks at Microsoft's renewed push around integration and how that could raise many companies' software acquisition costs.

In one sense, integration is nothing new for Microsoft. Tacking browsers, media players, disk managers and other stand-alone functions onto Windows is a longstanding practice. The company also has long integrated like applications together, with Office being the best example. But recently, Microsoft has started integrated vertically, from the desktop to the server. This July blog touches on some of this increased cross-integration.

This new strategy, which Microsoft says really is about the server stack, is much broader. Microsoft has had modest success gaining presence for its server software in the enterprise, but nowhere on the order of, say, Windows desktop or Office. Vertical integration of features between these clients and the server gives Microsoft some pull to bring Server System products into the enterprise.

But, as the report states, not without raising many customers' software acquisition costs. One reason: Typically, the full benefit of integration would only come by investing in multiple products. There are other reasons, and the report lays out exactly what those estimated increases would be.

Posted by Joe Wilcox at October 08, 2003 09:14 AM