Microsoft throws off something like $14B in free cash flow. They could use their toll booth-like cash flow to acquire good businesses that offer nice, steady returns, in areas outside of tech. There is some logic in the conglomerate model after all. Go buy a big insurance company.
http://en.wikipedia.org/wiki/List_of_mergers_and_acquisition...
The reason IBM does not get outside the technology sector is because the profit margins are one of the highest when it comes to software. They have sold most of their non-software business's in recent years: They dumped the loss making Thinkpad for a hefty sum to Lenovo, got rid of most of their semiconductor business and are a software sales company today. I guess the same reason will apply to MS for not getting into any non technology sector.
IBM might have someone like that in place, but I'd imagine Microsoft does not.
If you want shares in a holding company, you buy Berkshire Hathoway shares or something similar. You want Buffet on that job, not Ballmer. MSFT should (and do) give this money back to shareholders to invest in 'businesses that offer nice, steady returns, in areas outside of tech' themselves. They don't need Microsoft for that.
But, if shareholders would rather MSFT survive, they should look into hiring a savvy CIO to handle that end of the business.
Either can work, it just depends.
On an EV/EBITDA basis the company is around 10x.
Conversely, Apple is around 15x and Google is about 16x. Both multiples imply some pretty rich growth prospects whereas MSFT's 10x does not.
also,
It’s not a failure when something like Orkut doesn’t take off: it’s a successful risk assessment.
i can't understand why folks think Orkut is not doing well. i'm Punjabi and nearly everyone who is my age group, that i know in India, has an Orkut account.