Avoiding Challenges & Taking Risks

The Barbarians Are At The Gate, But Microsoft Moves To Protect Office Revenues – By their very nature, corporations like Microsoft are not capable of taking risks in the name of innovation – unless they are creating a new paradigm or a new market.
Microsoft realizes that Google Docs – available online and free – is a threat to its Office suite of products (primarily Word & Excel). In response, they’re ramping up for their own online versions of their products, but they’re not getting it right:

Microsoft is falling into the classic trap of failing to realize the disruptive nature of a new competitive technology, instead focusing on the massive revenues it generates from their aging Office suite.

Someone makes a good point in the comments of this article, “You realize if Microsoft shipped a full online Office product, they would cannibalize themselves, right?”
This comment is true, but an online Office product would only cannibalize themselves if they remained entrenched in their current business model. Short term, this is the easier path to take, but long term, Microsoft shouldn’t expect its products to be viewed as relevant or useful.
Contrast this screw-up by Microsoft with the risk Apple is taking with the iPhone. One of the reasons Apple is able to dive into the mobile industry is because they’re being disruptive and establishing a new paradigm. Aside from the innovative Visual Voicemail, Apple is not locked into any crappy AT&T specific services for broadband, games or anything. You sync your iPhone with iTunes, which not only allows you to sync music and video content, but also patches bugs and adds new features. AT&T is simply a communication connection – as it should be.
Apple also don’t have any presence in this market, so like Dylan said, when you got nothin’, you got nothin’ to lose.
Of course this is only partly true. Apple could have lost years and years of preparation and research and tens of millions of dollars that went into making the iPhone …but that’s why it’s called taking a risk.
Risks have potentially huge payoffs.
I love the comment Paul Arden makes in his book, Whatever You Think, Think the Opposite:

Most people are reasonable, that’s why they only do reasonably well.