"Microsoft's revenue depends overwhelmingly on selling upgrades of
software to its huge installed base. As the growth rate in this
business slows, however, Microsoft must look for new sources of
revenue. It has thus evolved its Windows.Net strategy and
subscription pricing as a way to ensure future revenue growth."
"In one important way, Microsoft's Windows.Net strategy
resembles its previous platform strategies based on the Windows
operating system with its application programming interface (API).
In offering the functions via APIs, Microsoft aims to transfer its
desktop leadership into the Internet, but via a controlled
transformation that maintains ties to the desktop."
"Microsoft's challenge is to persuade businesses that its
Windows.Net services are more attractive than what they have on
their desktops today. ... The risk for Microsoft is to transition
revenue from its cash-cow desktop business model to the uncertain
flow of revenue on the Internet."
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