Microsoft

Submitted By : Aakash parajuli

Level
: BBIS 4th year
Roll No
: 18
Submitted To: Birat Shrestha

Introduction
Microsoft is an American multinational corporation headquartered
in Redmond, Washington, that develops, manufactures, licenses, supports
and

sells computer

computers and

services.

software, consumer
Its

best

known

electronics and personal

software

products

are

the Microsoft Windows line of operating systems, Microsoft Office office

suite, and Internet Explorer web browser. Its flagship hardware products
are the Xbox game consoles and the Microsoft Surface tablet lineup. It is
the world's largest software maker measured by revenues. It is also one of
the world's most valuable companies.
Microsoft was founded by Bill Gates and Paul Allen on April 4, 1975,
to develop and sell BASIC interpreters for Altair 8800. It rose to dominate
the personal computer operating system market with MS-DOS in the mid1980s, followed by Microsoft Windows. The company's 1986 initial public
offering, and subsequent rise in its share price, created three billionaires
and an estimated 12,000 millionaires from Microsoft employees. Since the
1990s, it has increasingly diversified from the operating system market
and has made a number of corporate acquisitions. In May 2011, Microsoft
acquired Skype Technologies for $8.5 billion in its largest acquisition to
date.
As of 2013, Microsoft is market dominant in both the IBM PCcompatible operating system and office software suite markets (the latter
with Microsoft Office). The company also produces a wide range of other
software for desktops and servers, and is active in areas including Internet
search (with Bing),

the video

game

industry (with

the Xbox, Xbox

360 and Xbox Oneconsoles), the digital services market (through MSN),
and mobile phones (via the Windows Phone OS). In June 2012, Microsoft
entered the personal computer production market for the first time, with
the launch of the Microsoft Surface, a line oftablet.
With the acquisition of Nokia's devices and services division to
form Microsoft Mobile Oy, the company will re-enter the smartphone

hardware market, after its previous attempt, Microsoft Kin, which resulted
from their acquisition of Danger Inc.

Products And Services Offered By Micorosft

Microsoft is an unusual company for the sheer number of product lines
that bring in more than a billion dollars. While the company doesn't break
out revenues for all of its product lines, Communications Director Frank
Shaw famously revealed Microsoft's billion-dollar businesses to the
TechFlash news blog last year. Under those businesses, are Microsoft's
most important product lines. And they are: Windows, Office, Exchange,
SharePoint, SQL Server, Windows Server, Visual Studio, Xbox, Bing, Skype,
Phones, Cloud Storage Devices etc. Microsoft generate most of its revenue
from the Windows and the Offices product lines and nearly 70% of the
profit of Microsoft counts only from the Windows and Office.

Entry Mode For Microsoft

Firms enter into market into several forms, and new approaches continue
to evolve. The initial entry mode used to penetrate the foreign market
must be chosen carefully carefully because of its potential effects on the
success of the venture . another factor is difficulty in changing the mode
without the considerable loss of time and money. Microsofts Aim is
always to became a leader in the market in which they operate or
compete. For which they followed strategies like the following when they
were just a start-up company: partnership with or acquiring other market
leaders, Entry in new market where there is need. They used their
resources and achieve the growth with the maximizing shareholders
wealth. With a continuous development and entry in new markets they
maintained their competitive advantage. The reason why Microsoft
wanted to go international was , they were leaders in the domestic market
and they want to increase their market size. They wanted to take
advantages of the other growing markets around the world. Being a leader

in OS Business, they wanted to first take advantage be entering in new

markets before competitors, and maintain their competitive advantage.
Initially they followed Licensing and Strategic agreements as a entry mode
international strategy. There are many reasons why they go for this kind of
strategy , some of these are:
Involves low cost to expand the internationally, as there is low cost
of development.
Allows license to absorb risks, less amount of risks because of the
risk sharing approach.

Multidomestic Strategy
A firm using a multidomestic strategy sacrifices efficiency in favor of
emphasizing responsiveness to local requirements within each of its
markets. Multidomestic strategy is an action plan that the firm develops
to produce and sell unique products in different markets. To use this
strategy, a firm establishes the relatively independent set of operating
subsidiaries in which each subsidiary develops specific products for a
particular domestic market. But here in case of Microsoft slightly follows
Multidomestic strategy and mostly it follows the Global strategy that
sacrifices the responsiveness to local requirements within each of its
markets in favour of emphasizing efficiency . Microsoft for example , offers
the same software program around the world but adjust the program to
match the local language

Forces In The Environment

Various internal and external forces influence upon the development and
operation of the Microsoft. And various environments such as Domestic,
foreign and international environment also effect the Business of
Microsoft.

Domestic Environment: It refers to the uncontrollable forces

originating in the home country that surround and influence the
firms life and development. US government policies, availability

of manpower inside the country etc effect the operation and

development of the Microsoft.

Foreign Environment: All the uncontrollable forces originating
outside the home country that surround and influence the
Microsoft. For example, after the acquisition of Nokia Corporation
by Microsoft , the decision made on manufacturing of Nokia
phones affect the operationability of the Microsoft. Nokia Phones
are made in Finland, China, Hongkong, Brazil etc and policies,
and availability of resources , manpowers and labor force in
those countries affect the development and operation of the
Microsoft.

International Environment: It is the Interaction between

domestic and foreign environmental forces or between the sets
of foreign environmental forces. It is also known as global
environment. Global environment transcends national
boundaries an is not confined in its impact to just one country.
International environment exerts influence over domestic as
well as over the foreign also with the forces like world economic
conditions, international financial systems, international
agreements and treaties, and regional economic groupings. And
since the early 1990s Microsoft has became the global leaders of
software services and internet technologies for the computing
industries. For example: European union Fined against the
Microsoft and ordered it to take out its media player software
from the European Windows versions.