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U.S.: Will Microsoft Windows Soon Become Obsolete?

When the value of stock in the Microsoft Corporation plummeted on Monday, most analysts blamed reports that the U.S. government wants to break the giant software manufacturer into two or perhaps three parts. But one stock analyst says Microsoft is doing poorly because its software and the personal computers (PCs) that use it may soon become obsolete. RFE/RL's Andrew F. Tully spoke to technology experts to gauge the future of Microsoft and the PC.

Washington, 28 April 2000 (RFE/RL) -- Much public attention is being focused on the U.S. government's battle against Microsoft Corporation and whether the world's largest software company should be divided into several parts.

Lost in these headlines may be a more important question: Is Windows -- the computer operating system that made Microsoft dominant -- too big to survive the next phase in the evolution of electronics? Could it, like IBM, become the loser, not the winner, in an industry it helped to create?

It was IBM that invented the personal computer (PC) in the early 1980s. Until then, computing had been done on large machines called "mainframes." Individuals could use electronic networks to work on these computers from what are known as "dumb" terminals -- nothing more than cathode-ray displays and keyboards. The PC -- a complete computer that could fit on the top of a desk -- was self-contained.

IBM, however, saw no future in the PC design, or "platform." In fact, the company decided not to patent the design and kept its focus on the mainframe -- the design that had made the American company dominant in computing around the world.

Other companies began flourishing by making PCs based on IBM's design. It quickly became axiomatic in the industry that IBM had become too big to recognize such an important trend. IBM is still a rich, important company. It still makes PCs, and its notebook computers are among the most highly regarded on the market. But it had lost a chance to maintain the dominance it once enjoyed.

Over the past few years, however, many observers have questioned whether the PC is really a permanent fixture. Over the past two years, there has been an explosion in "hand-held" wireless computing and communications hardware. Such devices, like the popular Palm Pilot, include functions like rudimentary word processing, spreadsheets, and databases. They also can have wireless access to the Internet.

Such products are inexpensive -- often about one-sixth the cost of notebook computers -- and are significantly more portable.

And they don't use the Windows operating system.

Will these smaller, more portable devices eventually replace the PC design, or "platform"?

One stock market analyst thinks they are already doing so. Richard Sherlund of the investment firm Goldman Sachs told the newspaper Financial Times that this was part of the reason Microsoft shares lost so much value in trading on Monday.

He said: "There is an increasing risk that Microsoft might atrophy on the PC platform as IBM did on the mainframe platform, while robust growth shifts to hand-held and wireless devices."

But experts in technology are skeptical of that view.

Solveig Singleton is a specialist in technology and telecommunications at the Cato Institute, a Washington think-tank. She agrees that there is a burgeoning market for hand-held computers, generically referred to as "palms." In particular, she believes that such devices eventually can stay small if voice-recognition technology matures to the point where it can credibly replace the keyboard.

But Singleton says people are not always on the move and will always prefer a larger computer with a keyboard, a large display, plenty of room to store data -- and the ability to expand its functionality to processing graphics, playing movies or editing sound.

"I don't see the demise of the PC coming any time soon. I think it'll be a situation where a lot of people will have both a 'palm' and a PC, just like a lot of people today have a mobile phone, you know, and a phone that they're really happy that they know where it is all the time and there's no danger of their losing it."

For years, many in the industry -- usually Microsoft rivals -- have proclaimed the imminent demise of the PC platform, only to watch the PC industry continue to grow. And John Dvorak, a technology columnist for PC Magazine, has repeatedly -- and gleefully -- reminded these prognosticators of their errors.

In an interview with RFE/RL, Dvorak rejected this latest warning from Sherlund. But he did not dismiss the idea entirely.

"In fact, the usefulness of a hand-held [device] is fairly limited, and the strength of the PC has always been in its versatility and power. That being said, I have no doubt that at some point a small device or a computer will shrink down to something potentially smaller, 'pocketable,' but that's so many years away that it's like not even -- it's not even worth considering."

In fact, it is this very versatility and power that makes the PC such a great contributor to productivity in the U.S. and around the world.

"When you're set to really sit down and do serious work, you can't really beat sitting behind a big, 21-inch monitor or a big flat panel and big keyboard and a machine with a lot of memory and a high-speed connection -- and that's just not going to happen on a hand-held anything. I mean, you can really, you know, do some serious work with one of these computers, and I don't see where that, you know, people are going to give that up all of a sudden. It's not going to happen."

Singleton says that even if hand-held wireless devices do someday drive PCs into extinction, she believes that Microsoft is capable of adapting.

"Microsoft is not the kind of company that I see -- even if the PC did go down the tubes [cease to be useful] -- that I see being completely incapable of responding. They're not an IBM."

Singleton says Microsoft is wealthy enough to hire the best -- and most forward-looking -- software designers. That alone, she says, should keep the company around for a very long time.