Understanding Of Microsoft And On How The Company Operates (Research Paper Sample)

Microsoft Managerial Economics
Students Name
University
Microsoft Managerial Economics
Abstract
Microsoft is undeniably the most prominent IT Company ever, taking the lead in both domestic and corporate computer marketplace. With their contribution to desktop PC, software market and a steady proportion of the server business, Microsoft is now governing many of the standards on which today's information systems are created. The company has also archived an extraordinary level of acceptance among business management. Microsoft is succeeding a long-term strategy to dictate four interconnected important markets, which are the Internet, enterprise, electronic commerce, and information appliances. The corporation is looking forward to creating a significant impact on all aspects of IT within a few years to come. The following research plays an important role in the understanding of Microsoft and on how the company operates.
Introduction
Microsoft Corporation is an American global computer technology company. Microsoft develops, manufactures, supports and licenses many software products for computing equipment. The company is the single most successful operating system for home desktop use. Microsoft is the world's leading company in the production of computer software. Some of Microsoft desktop software such as Microsoft Office and Windows media player are bundled directly to the operating system or are sold with the Windows preinstalled software on new systems. The company's biggest selling products are Microsoft Windows operating system and Microsoft Office. Both products have an outstanding reputation in the respective markets.
Microsoft's significant improvement took place in 1981 when they created an operating system for IBM during their first entry attempt to the personal computer market. In 1980,'s both Microsoft and IBM had dominated the market as Microsoft took a lead in the software market while IBM dominated the personal computer market. Later Microsoft introduced their first operating system in the year 1983, which was highly influenced by the existence of Apples (GUI) graphical user interface. Over time, Microsoft has proved to be the dominant computer software company. Despite the positive acceptance of Microsoft achievements within the enterprise, there are some controversial agendas concerning the direction the company will be heading in the future. Microsoft is facing tough competition on different fronts within the business-critical environment. Additionally, software delays and legal issues together with the technical problems of some of Microsoft's primary products have raised doubts about the company's future success.
Product Description and Usage
Being a multinational corporation, Microsoft has ventured in different lines of production on computers, software, and electronics. To be clear, tracking all the products manufactured by Microsoft can be hectic and therefore, to make it easy most of these products are categorized according to their functionalities. The most common category is the Windows and device. This makes sure that the company comes up with the best ideas when creating operating systems for different devices. For instance, Windows operating system has come up with one of the most artistic phones in the market the windows mobile. Additionally, they have Windows NT, which is a consumer user interface that is pre-installed on a computer during purchase. The purpose of these operating systems is to allow users access the interface they want to use as long as it is created by Microsoft.
Cloud and Enterprises are the second categories of Microsoft products. In this category, one of the important products is the Server. In this case, Microsoft offers a suite of server software, known as the Microsoft server for private clouds. Windows Server 2016, an operating system created purposely for network servers, is the best server as compared to any other in the market. These servers are used for connection purposes mostly by connecting several computers to the same network and allowing them to share files and information. Second, there is the visual studio, which is Microsoft's set of compilers and programming tools. The software is created to operate under a graphical user interface. The purpose of this software's is to assure smooth running of various programs on Microsoft products.
Application and services are the last categories that are used in the identification of the products offered by Microsoft. In this category, Microsoft office is practically the most common product since it is an essential aspect of all computers and most smartphones. Additionally, Microsoft has made voice over internet protocol much accessible by introducing Skype. The product core function is communication be it visually, texting, or voice calls.
Factors Determining Demand for Microsoft's Products
In economics, demand is described as the amount of goods and services that a consumer is prone and able to purchase at a given price at a particular time. The law of demand states that there is an inverse similarity between the price of a good and the quantity demanded. Therefore, if the price of a particular good rise, it is likely to decrease the quantity demanded of the good and if the price of the good falls, it will bring an increase in quantity demand (Salvatore & Brooker, 2001). Looking at the whole market share, Microsoft seems to have a monopoly in operating systems for personal computers. And yet they always have a way to keep their prices low as compared to any other monopolist in the market. However, a few years ago people had to spend more to have software that provided a fraction of the capabilities that are offered by Windows today.
The truth is that Microsoft can charge people more if it pleases them. Still no operating system has been able to stand out when compared to Microsoft. Therefore, this makes the demand for Microsoft products high since people need the products on daily bases. Besides having a large consumer market than any other software company, Microsoft offers their products at low costs and keeps improving the products functionality to make sure that they are the best on the market. However, some other companies have affected the demand and supply of Microsoft product in some parts of the world. For instance, many people are slowly turning to Linux due to its detailed functionalities that are not offered on Microsoft operating systems. Though the effect of competition by companies such as Apple, IBM, and Sun may be small it may affect Microsoft in the future if they let their guard down. Some researchers have argued that Microsoft Windows operating system is the most important component on most personal computers purchased in the market today and computer manufacturers have no choice but to install Windows on their machines and therefore making the demand high (McAuliffe & Blackwell Publishing Ltd, 2005).
Factors Determining Supply for Microsoft's Products
The supply of products and services in the market is determined by several factors, including production mass, production cost, and the amount of other businesses involved in providing the goods or services in question. At times, some aspects that are essential in determining supply in one area may be ineffective in another. Manufacture, for example, is a crucial factor in determining the provision of Microsoft operating systems. Recently, there has been stiff competition mostly on mobile phone operating systems, therefore affecting the supply of Windows operating mobile phones (Gaughan, 2013). The market has been dominated by operating systems such as Android that have given all other competitors a run for their money. Most windows phones are slightly expensive as compared to Android. For that, it has led to many people turning to Android phone affecting the supply and demand of Microsoft Windows phones. All mobile companies are at war, and Microsoft is caught in it and if they do not upgrade their software as often as other operating systems then they will have to reduce the prices of their products to increase the supply of their mobile phones.
However, the production cost of some Microsoft operating system is small as compared to the cost of their products in the market (Gaughan, 2013). Therefore, that is one of the ways Microsoft can boost their supply. Despite the high prices on Microsoft operating systems, suppliers are stocking their businesses with the products since many customers will end up buying the products because of the company's reputation. Technological changes are the biggest challenges that Microsoft is facing in terms of supply. The company is forced to be creative and keep up with the trend or risk losing customers to other upcoming companies. Additionally, the supply of Microsoft products has been highly affected by some governmental regulations that have ended the company to court several times. One of the biggest threats Microsoft has faced has been on their gaming console Xbox. The latest console Xbox one has done well on the market, but the customers are complaining regarding the price of the console. However, for Microsoft to recover production cost they had to increase the price of the gaming console that has highly affected the products demand and supply (Gaughan, 2013). In the future, the company's supplies are expected to increase since many people have no choice but to use the products they trust and believe in from Microsoft (Gaughan, 2013).
Product Substitute and Demand
One of the biggest competitors of Microsoft is Apple. The two companies have been in competition for the longest time. However, many consumers end up going for Microsoft since it is cheaper compared to Apple products. The durability and originality of both products are questionable. However, the reason as to why Apple is more expensive is because their products ar...