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Dear Mr. Berko:

Dear K.P.:

I used Windows 95, and it worked as fine as a Swiss watch for 10 years. A friend of mine has Windows 98. He has been using 98 for nearly a decade and is as happy as a hog on ice. How many Windows does the world need? Originally, Microsoft gave us Windows 3.1, then Windows 95, then Windows DUM, then Windows 98, then Windows 99, then Windows YUK, then Windows 2000, 2001, 2002, 2003, 2004, 2005, then Windows XL, then Windows XXL, then Windows XLT, then Windows Vista and now Windows 7.

In a couple of years, Microsoft Corp. (MSFT — $30.90) may come out with Windows 007, or Windows 666, ad nauseam. And for most of us common folks in the universe, not one of these systems is worth a bean more than the other. MSFT, like the automobile companies, plans on planned obsolescence to generate new revenues. This is a craven way to goose revenues and bamboozle dollars from an easily dupable public. If the average Joe or Jane who uses 2000 thinks that 7 will make an important difference, they’re dumber than a tick in a mai tai. Windows 7 is more sizzle than steak, and most users who switch to 7 may be mighty disappointed.

Microsoft expects to ship nearly 200 million copies of Windows 7 by the end of 2010, and there’s wide expectation that 7 will drive a new boom in tech sales. Potential buyers will be told that 7 will make them more productive, more competitive and their system more secure. Well, that’s pure terradiddle, trumpery and twaddle. Basically, 200 million new 7 users will be driving the same Chevy, with essentially the same engine, tires and transmission, but a different grille and tail lights. The saccharin-sweet hype on those TV commercials isn’t all it’s hyped up to be.

Frankly, I don’t think 7 will do much for MSFT’s stock price, and I doubt that the sales of 7 will meet the company’s expectations. Unemployment exceeds 17 percent (when you include those who have stopped looking), and consumers, who are responsible for 71 percent to 75 percent of our gross domestic product, are now reluctant to buy things that they don’t absolutely need. And most users need 7 as much as they need a migraine.

Microsoft is not as powerful as it once was. Apple has a new, loyal group of iPod-buying customers who, when they buy a new computer, will probably buy an Apple. Free online software (open source), such as Linux, and Google’s Android, are becoming tough competitors. Cloud computing is becoming a disruptive force, and MSFT’s revenues may be handicapped by the company’s need to protect its legacy.

In 2008, Microsoft’s revenues were $60.4 billion; in 2009, the Street expects $58.4 billion; and in 2010, when 7 sales are in full force, the Street is thinking $57.8 billion. 2009 will be the first year in 20 that MSFT has not increased its earnings.

If you have any doubt about MSFT’s stock price, take a peek at Warren Buffett’s Berkshire Hathaway portfolio. Bill Gates and Buffett are friends and as close as bark on a tree. However, there isn’t a single MSFT share in the Berkshire Hathaway portfolio.

If MSFT isn’t good enough for Gates’ bosom buddy, then it shouldn’t be good enough for you.

Please address your financial questions to Malcolm Berko, P.O. Box 8303, Largo, Fla. 33775 or e-mail him at mjberko@yahoo.com. © 2009 Creators.Com