pplication side, several products, such as Word and Excel, have reached a high level of market penetration in their markets, and Microsoft is pursuing other product areas. One of the key reasons that the company has been successful with its various applications is that it has persuaded major manufacturers of personal computers to "bundle" Microsoft software onto machines as they ship. This has resulted in a loss of revenue as the company licenses the software rather than sell it directly, but it has also increased the market share that the company enjoys since consumers are less likely to go out and purchase a competitor's software for an application they already have (such as a word processor or spreadsheet) (1995 Microsoft 10-K Filing, 1995, p. 17). Consumers are still responsible for purchasing their own upgrades to their application products.
The company's primary strength comes from its financial position. Microsoft has posted return on net revenue in the mid twenties for the past several
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