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This comes to mind because of the following...
It's common knowledge amongst economically minded techies that Microsoft faces a serious problem.
It's operating system dominates the global user market. It's 'productivity tools' (Word, Excel, Powerpoint, etc.) are the de facto office software for millions upon millions of people.
The company appears to rule the IT world.
Yet there's a problem - Microsoft's traditional revenue stream is mostly dependent upon enticing (or forcing) its vast customer base to regularly pay for new versions of its operating system, applications and service platforms (mail server, database server, etc.). However, customers now have less incentive than ever before to upgrade -- if, for example, an accounting firm has mastered and tweaked Windows 2000 server and workstation and they're running fairly well for their office what's the business need to 'upgrade' to Windows XP and Server 2003 on Microsoft's schedule?
There's even less incentive for 'upgrading' to new versions of the 'productivity suite', Microsoft Office, (in how many new ways can you type a letter?).
There's a tremendous surplus of available product along with surplus productive capacity.
It appears Microsoft's monopoly position has created a cage from which it's trying to escape through "software assurance" licensing agreements (guaranteeing income for MS from you whether you upgrade or not), acquisitions of competitor firms, insertion into transaction-based revenue streams such as digital media and forays into other areas of industry - all made possible by its mind bogglingly deep well of capital.
It seems to me that beneath this surface of frenetic activity lies a stagnant core. That is, although there's still room for monopolist expansion, the midpoint of the project is a gigantic pipe funneling revenue in with fewer places to spend it and the endpoint is slow decline.
Other major IT industry players may face similar problems in their fiefdoms.
I'm eager to learn if anyone's done work on this topic.
DRM