How Microsoft Lost the API War

Here's a theory you hear a lot these days: "Microsoft is finished. As soon as Linux makes some inroads on the desktop and web applications replace desktop applications, the mighty empire will topple."

Although there is some truth to the fact that Linux is a huge threat to Microsoft, predictions of the Redmond company's demise are, to say the least, premature. Microsoft has an incredible amount of cash money in the bank and is still incredibly profitable. It has a long way to fall. It could do everything wrong for a decade before it started to be in remote danger, and you never know... they could reinvent themselves as a shaved-ice company at the last minute. So don't be so quick to write them off. In the early 90s everyone thought IBM was completely over: mainframes were history! Back then, Robert X. Cringely predicted that the era of the mainframe would end on January 1, 2000 when all the applications written in COBOL would seize up, and rather than fix those applications, for which, allegedly, the source code had long since been lost, everybody would rewrite those applications for client-server platforms.

Well, guess what. Mainframes are still with us, nothing happened on January 1, 2000, and IBM reinvented itself as a big ol' technology consulting company that also happens to make cheap plastic telephones. So extrapolating from a few data points to the theory that Microsoft is finished is really quite a severe exaggeration.

However, there is a less understood phenomenon which is going largely unnoticed: Microsoft's crown strategic jewel, the Windows API, is lost. The cornerstone of Microsoft's monopoly power and incredibly profitable Windows and Office franchises, which account for virtually all of Microsoft's income and covers up a huge array of unprofitable or marginally profitable product lines, the Windows API is no longer of much interest to developers. The goose that lays the golden eggs is not quite dead, but it does have a terminal disease, one that nobody noticed yet.

Now that I've said that, allow me to apologize for the grandiloquence and pomposity of that preceding paragraph. I think I'm starting to sound like those editorial writers in the trade rags who go on and on about Microsoft's strategic asset, the Windows API. It's going to take me a few pages, here, to explain what I'm really talking about and justify my arguments. Please don't jump to any conclusions until I explain what I'm talking about. This will be a long article. I need to explain what the Windows API is; I need to demonstrate why it's the most important strategic asset to Microsoft; I need to explain how it was lost and what the implications of that are in the long term. And because I'm talking about big trends, I need to exaggerate and generalize.