Originally Posted by HarryT
Many of Microsoft's corporate products, such as SQL Server, Exchange Server, Sharepoint Server, Commerce Server, etc, are leaders in their fields. A very high proportion of the largest companies in the world run...
These products ... are highly commercially successful products.
Hmm, am I really being that obtuse? Since I can't figure out how to say it any more clearly, I'll repeat my previous quote again:
"Microsoft has *tried* many other things. It has made money at *none* of them."
"Leaders in their fields", certainly. Widely used, absolutely. "Commercially successful"? If by "commercially" you mean "financially", I'm not sure I agree.
I've just spent the past couple of hours googling, and have been unable to locate a breakdown of operating income by product for Microsoft, so I'll do a bit of speculating based on overall numbers.
A recent WSJ article
, commenting on the importance of Windows and Office to Microsoft's profitability, observed that in FY12 Microsoft's "three other divisions together generated 42% of revenue but no operating profit between them." That is, while Server and Tools, Entertainment and Devices and Online Services brought in 42% of MS's FY12 revenues, after subtracting off operating expenses Microsoft made no money on them, which is exactly what I said. But that's a bit disingenuous.
Here is Microsoft's FY12 operating income breakdown by division (in millions):
Windows & Windows Live: $11,460
Server & Tools: $7,431
Online Services: ($8,121)
Entertainment and Devices: $364
Coporate-level activity: ($5090)
Since I haven't been able to find a breakdown by product, for the sake of argument I'll just pretend the Tools side of Server and Tools accounted for 50% of the S&T profits, and (again, for the sake of argument), we'll give Exchange and SQL Server each one third of that half.
That works out to about $1.25 billion profit per product. Given a total operating income of nearly $35 billion ($31 billion of which derived from Windows and Office), that's what I define as "made no money at". Certainly, it's not money Microsoft could survive on. (In addition, I would argue that both Exchange and SQL Server are only as successful as they are because they're tied to Windows, but that's an argument for another day.)