SecProbe.io

May 11, 2011
 Via Facsimile

Douglas K. Thede Executive Vice President, Finance and  Chief Financial Officer Microstrategy, Inc. 1850 Towers Crescent Plaza Vienna, VA 22182
Re: Microstrategy, Inc.
 Form 10-K for the Fiscal Year Ended December 31, 2010
Filed February 18, 2011 File No. 000-24435

Dear Mr. Thede:
 We have reviewed your filing and have the following comments.  Please note that we
have limited our review to only your financial statements and related disclosures.  In some of our
comments, we may ask you to provide us with  information so we may better understand your
disclosure.
 Please respond to this letter within ten business days by amending your filing, by
providing the requested information, or by advi sing us when you will provide the requested
response.  If you do not believe our comments apply to your fact s and circumstances or do not
believe an amendment is appropriate, pl ease tell us why in your response.
 After reviewing any amendment to your filing and the information you provide in
response to these comments, we ma y have additional comments.
            Item 7.  Management’s Discussion and Analys is of Financial Condition and Results of
Operations
 Comparisons of the years ended December 31, 2010, 2009 and 2008

 Costs and Expenses, page 47

 1. We note that in 2010 cost of revenues and ge neral and administrative expenses increased
significantly more than revenues, whereas in 2009, cost of revenues increased in
proportion to revenues and general and admini strative expenses decr eased.  We further
note that the cost increases in 2010 are attribut able in large part to  increases in staffing
levels.  Please tell us whether staffing level in creases will cause a material change in the

 Douglas K. Thede Microstrategy, Inc. May 11, 2011 Page 2
 relationship between costs and revenues a nd if so, how you considered disclosing the
expected impact on future results of operati ons.  Please refer to Rule 303(A)(3)(ii) of
Regulation S-K.  This comment also applies to your Form 10-Q for the quarterly period
ended March 31, 2011.
 Provision for Income Taxes, page 50

 2. Please tell us how you considered providing disclosures that explain the impact on your
effective income tax rates and obligat ions of having a significant amount of  earnings in
countries where you have lower statutory tax ra tes.  In this regard, while we note your
disclosure that the decrease in  the company’s tax rate in 2010  was, in part, due to an
increased proportion of foreign income ta xed at lower rates, you should consider
explaining the relationship between the foreign and domestic effective tax rates in greater
detail as it appears as though se parately discussing the foreign effective income tax rates
may be important information necessary to und erstanding your results of operations.  To
the extent that certain count ries have had a more signifi cant impact on your effective tax
rate, please tell us how you considered di sclosing this information and including a
discussion regarding how potential changes in  such countries’ operations may impact
your results of operations.  Please refer to  Item 303(a)(3)(i) of Regulation S-K and
Section III.B of SEC Release 33-8350.  This co mment also applies to your Form 10-Q for
the quarterly period ended March 31, 2011.  In th is regard, we note that “stronger results
outside the U.S.” was a factor in the lower e ffective tax rate for the three months ended
March 31, 2011.
 Liquidity and Capital Resources, page 52

 3. We note that a substantial amount  of your earnings of foreign s ubsidiaries are indefinitely
reinvested outside of the U.S.  Please tell us how you considered disclosing the amount of
cash and cash equivalents that are currently he ld outside of the U.S. and the impact of
repatriating the undistributed earnin gs of foreign subsidiaries.  In this regard, we note that
this disclosure would i llustrate that some cash is not pr esently available to fund domestic
operations and obligations without paying ta xes upon their repatriation.  Please refer to
Item 303(a)(1) of Regulation S-K and Section IV of SEC Release 33-8350.  This
comment also applies to your Form 10-Q fo r the quarterly period ended March 31, 2011.
 Notes to Consolidated Financial Statements

 (2) Summary of Significant Accounting Policies

 (h) Revenue Recognition, page 66

 4. We note your disclosure that vendor-speci fic objective eviden ce (“VSOE”) of post-
contract customer support (“PCS”) is determ ined based upon the optional stated renewal

 Douglas K. Thede Microstrategy, Inc. May 11, 2011 Page 3
 fee for PCS in the contract, which is the pric e the customer is required to pay when PCS
is sold separately.  Please tell us how you de termined the stated renewal rates included in
your arrangements are substantive.  In this re gard, please tell us your  VSOE of PCS price
range of renewal rates, the percentage of PCS arrangements that fall within this price
range, and what percentage of your cust omers actually renew at such rates.
 (8) Income Taxes, page 73

  5. We note the impact your international operati ons had on your effectiv e tax rate in your
rate reconciliation.  Please pr ovide us with a breakdown of the components of this line
item and tell us how you considered providing fu rther quantitative breakdown of this line
item in your disclosure.  See Rule 4-08(h)(2) of Regulation S-X.

 We urge all persons who are responsible for th e accuracy and adequacy of the disclosure
in the filing to be certain that the filing include s the information the Securities Exchange Act of
1934 and all applicable Exchange Act rules requir e.  Since the company and its management are
in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy
and adequacy of the disclosures they have made.

 In responding to our comments, please provi de a written statement from the company
acknowledging that:
• the company is responsible for the adequacy an d accuracy of the disclo sure in the filing;

• staff comments or changes to disclosure in response to staff comments do not foreclose
the Commission from taking any action with respect to the filing; and

• the company may not assert staff comments as  a defense in any proceeding initiated by
the Commission or any person under the federa l securities laws of  the United States.

You may contact David Edgar, Staff Accountant, at (202) 551-3459 if you have questions
regarding comments on the financial statements and related matters.  Please contact me at (202)
551-3406 with any other questions.
Sincerely,
   /s/ Patrick Gilmore
Patrick Gilmore Accounting Branch Chief