only Exxon Mobil makes more money than Microsoft…

That’s according to our esteemed CEO, Steve Balmer, who was in Beijing today for the grand opening of the new $400 million Asia R&D campus.  Steve spent an hour addressing the local Microsoftees and I was lucky enough to watch a live video link at our Shanghai campus.

Say what you like about SteveB but nobody can compare to the energy and passion he has for Microsoft and the candour and honesty with which he speaks his mind. I like the guy. He even did one of his famous ‘monkey jumps’ for a local fan – although he preferred it be called ‘being very passionate and excited!’.

The well known ambiguity of the Chinese nation is firmly manifest in Microsoft’s China operation. China sells 60 million PCs a year – about the same as the US – but Microsoft only makes 1/2oth of the revenue per PC in China as it does in the US! In fact the revenue per PC here is 1/6th that of even India… Basically, that means the Chinese are even bigger cheapskates than the Indians… In fact Microsoft has more revenue in The Netherlands than it does in China but I don’t see them building $400 million dollar buildings there. Why? R&D skills are good, cheap and plentiful in Asia. That xBox console, that Kinect controller, that new piece of enterprise software is all being developed here in China.

The audience had the usual anticipated type of questions about the NOKIA partnership, Skype purchase, future plans and our big competitors like Google and Apple. SteveB responded with some numbers to cheer us all up.  Microsoft sold 350 million copies of Windows last year – Apple only 30 million + 20 million iPads i.e. 50 million vs 350 million. A fair comparison? I leave you to decide.

Some more nuggets from SteveB

  • Google is giving away its Android smart phone software for free (which they stole from MS and we are suing them). 
  • Skype is profitable – they made $200 million profit last year on revenue of $800 million. (I pity the fool that asked this question to SteveB. I hope he’s not in accounting)
  • Skype will be integrated into Kinect eventually once they get all our existing IM products talking nicely with it.
  • Ironic that xBox is not even sold in China yet all the R&D is done here…(lets hope his meeting today with the Chinese government might clear the way)
  • Microsoft China is the only MS subsidiary that has all the functions of the US (except they still don’t have an employee purchase scheme for software ????- me)
  • doesn’t know why MSFT share price is the same as 10 years ago even though we have 3 x the revenue

He ended the talk with the 3 ways on how we’re going to increase revenue another 3 times to finally get that MSFT share price to budge – by taking some market share from the 3 market leaders: Suck a little search from Google, some phones from Apple and some database from Oracle… which means we’re relying on BING, Windows Phone and SQL Server for growth…

This entry was posted in Microsoft China and tagged , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s