Imagine a product that many public do not think works well but sells millions of copies. Well, that’s Microsoft (NASDAQ: MSFT) operating system, Windows Vista.

According to the FT, both trade and personal computer users have tried to stick with older versions of the Microsoft OS, Windows XP, but adoption is still good enough to drive outstanding earnings for the world’s largest software company. As the newspaper says: “None of that, however, has had any discernible affect on Microsoft’s financial fortunes. Many companies buy their software from Microsoft under an arrangement called Software Assurance, which lets them upgrade to new software whenever they like in return for a fixed annual payment.”

Perhaps that is what having

a monopoly is all about. Even whether products are not perfect, they are adopted. Even whether companies normally would not build an investment, they are on an “automatic upgrade” program.

It might be nice to think that Linux or Apple’s (NASDAQ: AAPL) new OS, Leopard, would get wider adoption, but based on most figures, the Mac has no more than 5% of the global PC market and no open-source desktop program has meaningful market penetration.

It’s good to be king.

Douglas A. McIntyre is an editor at 247wallst.com.

Original post by Douglas McIntyre

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