Microsoft created a vertically integrated product when they released Clip Art as an image repository for Powerpoint. For years, this integration worked beautifully, if for no other reason than there was no alternative or incompatible technologies.
But again, like in so many other areas of Microsoft land, their idea of vertical integration is badly outdated. If they want to be vertical, they need to dominate through ease of use, not technical imcompatibility.
All works well in PPT to Clipart land if you are using Internet Explorer. But if you use firefox or have a mac you are SOL!!. It simply does not work. Error messages are misleading. Its much faster to go to google images, find a free image and copy it into your PPT than go through the constant headache of poorly written error messages and obfuscation.
Because Microsoft does not seem to support Firefox or Safari with Clip Art gallery and the critical import function into PPT, they force users to go outside MSFT vertical stack to find a solution — and likely never to return. Thus, the benefit of vertical integration to the provider — more user stickiness and higher switching costs — is destroyed, not by competition, but by the provider itself.
Contrast this mess to Apple’s notion of vertical integration. Itunes runs on every possible type of computer for a reason. They want to make it as easy as possible for every user to get the full advantage of the vertical integration. Who cares that ITunes is restricted on the Palm Pre. That is not a substantial enough user base to make a difference. Would that Microsoft wake up to the market penetration of Firefox + Safari and now Chrome to realize that in their misguided attempt to force users to use IE, they are making it easier for users to ultimately leave PPT — an otherwise very sticky product.
I can’t think of a better example of shooting oneself in the foot than this example. Its a small example. True. But Microsoft has forced me to look beyond their product stack, thereby lowering the cost of switching when a suitable replacement for PPT arrives (not yet Google Docs, but soon).
