Microsoft's New Path: Cooperation and Growth

This week, Microsoft shareholders approved the largest dividend payout in corporate history, resolving major antitrust issues and launching a new search engine to challenge Google and Yahoo!. The company's $32 billion dividend payout reflects a shift towards cooperation and negotiation, marking the maturation of Microsoft's business model. As the company seeks new avenues of growth and profit, it faces challenges in the form of Linux drawing market share from the Windows operating system and struggling to challenge Google's dominance in search.

Key Takeaways:

• Microsoft has paid Novell over $500 million to resolve a long-standing antitrust complaint, reflecting a shift towards cooperation and negotiation.
• The company's dividend payout totals $32 billion, with Microsoft still holding over $30 billion in cash.
• Windows and Office business growth potential is limited, prompting Microsoft to seek new revenue streams through online search and games.
• Halo 2, a new Xbox game, posted sales of over $125 million in its first day, making it one of the hottest game debuts in history.
• Microsoft's search engine aims to challenge Google's dominance, but experts note that knocking off a company that has become an American icon will be challenging.
• The potential profits from search and games are nowhere near what Microsoft has earned from its operating system and Office products.
• Microsoft faces challenges in the form of Linux drawing market share from the Windows operating system.

Statistics:

• Microsoft paid Novell over $500 million to resolve an antitrust complaint.
• The company's dividend payout totals $32 billion.
• Microsoft still holds over $30 billion in cash.
• Halo 2 posted sales of over $125 million in its first day.
• The search engine market is expected to continue growing, with online advertising spending increasing.

Sources:

• NPR's Wendy Kaufman reporting.
• Technology industry analyst Rob Enderle.
• Charles Hill, business strategy expert, University of Washington's Business School.
• Rick Chapman, managing editor of Softletter.
• Justin Osmer, program manager, MSN.