Microsoft Is Losing Its Edge

Internet Explorer isn't the bare-knuckled bruiser it used to be. New data from researcher Net Applications show Microsoft's (Nasdaq: MSFT  ) browser suffered its fourth consecutive monthly decline in usage in June, as both Google's (Nasdaq: GOOG  ) Chrome and Apple's (Nasdaq: AAPL  ) Safari gained. Firefox, once a major threat, managed to hold steady.

The details:

  • IE's share of last month's Web browsing activity fell to 53.7%, down six-tenths of a percentage point and a new low for the browser, according to Computerworld.
  • Firefox fell four-hundredths of a percent, but that's so small a change as to be immaterial in my book.
  • Chrome, on the other hand, gained exactly as much as IE lost, while Safari took most of the three-tenths of a percent giveaway the Opera browser suffered.

Microsoft told Computerworld's Gregg Keizer that its latest browser -- IE9 -- is the most popular modern browser on Windows 7. "Modern" is apparently the key word there. Mr. Softy only considers those browsers supporting HTML5 as modern, which in turn means no other version of IE could be more popular than 9, while competing alternatives are not only targeted at Windows but also the Mac and Linux.

The point nevertheless remains that IE is slipping as both Chrome and Safari gain, with each thriving for different reasons. Chrome has established itself as fast, Mac-friendly, and host to a wide variety of applications and extensions in a tip of the cap to Firefox. Safari is gaining as a consequence of iOS devices outselling the likes of Research In Motion (Nasdaq: RIMM  ) in smartphones and Motorola Mobility (NYSE: MMI  ) in tablets.

Should Microsoft investors worry? Not yet, but over the long term it's a good bet that the top provider of cloud-computing services will be the one with the best browser for cloud computing. Google and Apple are staking strong claims.

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Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He owned shares of Apple and Google at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. You can also get his insights delivered directly to your RSS reader.

The Motley Fool owns shares of Google, Microsoft, and Apple. Motley Fool newsletter services have recommended buying shares of Microsoft, Google, and Apple. Motley Fool newsletter services have recommended creating a bull call spread position in Apple. Motley Fool newsletter services have recommended creating a diagonal call position in Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


Read/Post Comments (8) | Recommend This Article (6)

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  • Report this Comment On July 06, 2011, at 12:36 PM, deemery wrote:

    "Microsoft is losing its edge" - Gee, where have you been for the last 5 or so years? With the exception of WIndows 7, which doesn't suck when compared to Vista, what has Microsoft produced for PCs that is in any way compelling? And there are still a lot of people for whom an older PC running WinXT is just fine (warts, security faults and all.)

    Is there any greater contrast in a single industry than Microsoft and Apple?

  • Report this Comment On July 06, 2011, at 12:37 PM, techy46 wrote:

    Chrome riding the Android wave. Let's see what happens when W8 (WP8) nails the smart phone and tablet with a UE that's also available on notebooks and desktops. IE running on mobile devices will level the playing field. Chrome's not better is't just the default for Android. As far as Microsoft losing edge, wait for Fcaebook, Nokia and Skype to converge on Windows 8.

  • Report this Comment On July 06, 2011, at 12:42 PM, techy46 wrote:

    @deemery - Apple spent 5-10 years on consumer gadgets, Microsoft spent 10 years on enterprise architecure for clouds. Apple spends next 10 years watching Microsoft migrate enterprise cloud technology down to consumers. Result; Windows 8 everywhere, Intel Inside, ARM tries to stay relevant, Google's advertising pyramid shrinks and Apple invents next big thing for Microsoft to copy.

  • Report this Comment On July 06, 2011, at 1:58 PM, deemery wrote:

    I'm seeing growing discomfort with Microsoft in the enterprise, too. Unlike 'back office', Microsoft offerings are not the only Cloud offerings under consideration. Here's a case where Microsoft will have to really compete with Google, Oracle, Cisco, Amazon, etc. Initiatives like Chrome and iOS are making desktop operating systems increasingly irrelevant in office situations; reasonably designed websites don't care what browser you use now and cloud offerings are unlikely to be tied to any desktop/handheld operating systems, either. In fact, Microsoft's way to lose is is to continue to build out a closed world. Given the choice between the Microsoft Way and the Highway, a lot of activities are revving their engines!

  • Report this Comment On July 06, 2011, at 8:19 PM, baldheadeddork wrote:

    Tim, remind me again how much Microsoft made from IE last year? Or last decade? You don't have to break it down to profit or loss. Revenues will be enough.

    And while you're at it, fill in how browser market share is connected to cloud computing. If it's such a good barometer, where the hell is Amazon's or EMC's browser?

  • Report this Comment On July 06, 2011, at 8:56 PM, baldheadeddork wrote:

    @deemery: "Initiatives like Chrome and iOS are making desktop operating systems increasingly irrelevant in office situations; reasonably designed websites don't care what browser you use now and cloud offerings are unlikely to be tied to any desktop/handheld operating systems, either."

    Respectfully, no.

    Running desktops from a server-based OS works great for large organizations where most users run the same one or two applications. CRM call centers are a great example.

    But when you have an office of even a couple dozen people all doing different things with several different programs, the back end processor and memory requirements for cloud-based computing explode. So does your network traffic.

    Also, different companies prefer different programs tailored for their business. Among the dozen medical practices I take care of are 5-6 practice management suites and at least three radiological image managers/viewers, plus dictation software and so on. No one I support just uses Windows and Office. This will complicate the processor/memory and bandwidth issue further.

    Remotely hosted OS and applications for most businesses are off in the distant future just because it's a long, lo-o-o-o-ng way from being cost competitive with the current setup.

    It also opens up an issue of reliability. The internet connection is the weakest network link for any small business. But if you have local OS files on local servers, you can continue to work when the internet is down. With full cloud computing, if you lose your internet connection your entire business comes to a halt. Putting everything in an offsite cloud also increases security risks for small businesses.

  • Report this Comment On July 07, 2011, at 3:54 PM, plange01 wrote:

    microsoft lost its edge the day balmer took over....

  • Report this Comment On July 09, 2011, at 7:54 AM, manriquesoto wrote:

    Wow so Microsoft Azure is not a strong claim for cloud computer? In your analysis a service to store music on the "cloud" is a stronger statement in that field vs a full fledge cloud infrastructure? And since when Microsoft profits ride on Internet Explorer? After all this is fool.com and not ZDNet.

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