Essay About Ms-Dos And New Position

Ryanair
Ryanair
1.Microsoft (MS) operates in a highly attractive growth industry with above-normal performance. Having a closed source business model, the first mover advantage in the 1970s and 1980s when the software industry was an emerging industry, still is the basis for their present success. This allowed them to achieve technological leadership. Above that MS acquired strategically valuable assets before their full value was widely understood (e.g.: cheap acquisition of an existing operating system (OS) from a local programmer in the 1980s; later: acquisition of PowerPoint, stakes in web companies). After the market saw a flood of IBM PC clones in the mid-1980s, MS used its new position, which it gained in part due to a contract from IBM, to dominate the home computer operating system market with MS-DOS (Microsoft Disk Operating System) by selling their OS software to original eqipment manufacturers (OEM), thus achieving a market of 85 % in 1985. This position enabled MS to create customer switching costs (training costs exceed the price of an application or operating system by up to 5 times). Launching the first version of windows was a great success and since MS-DOS and Windows were complementary products, MS was able to double its OS revenues per PC. By that time MS achieved a monopolistic position in that segment having reached a market share of 85% in 19993. In the late 1980s MS emerged as the world’s largest application vendor by bundling their application software to office suites and selling them for discount prices and thus creating switching costs again (as training costs are much higher than the actual price of applications). By selling Internet Explorer as a feature of MS Windows for free, MS quickly achieved a monopolistic