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  • The Microsoft Death Watch: In Search of a Strategy

    August 20th, 2014

    As I watched a TV ad for the Microsoft Surface 3 tablet/notebook, intended to compete with the MacBook Air, I was troubled by the lame attempt to draw important differences between the two. While an Apple spot will focus on lifestyle and the things you can accomplish with a Mac, an iPhone or an iPad, Microsoft is hoping a logical appeal, however tenuous, will turn the tide and boost tepid Surface 3 sales.

    This approach harkens back to those Surface ads that touted the presence of Skype and Microsoft Office, as if anyone outside of the business world really cares about the latter. It was about specs and features, and not about what you could actually do with the product. I also recall the first Surface ads, where a single person setting up the tablet was soon surrounded by jumping, dancing, prancing fools with noisy music, evidently hoping your senses would be so overwhelmed that you'd become the fool to buy the thing.

    The current Surface ads tout such debatable advantages as the presence of a touchscreen and a stylus when compared to the MacBook Air. At the same time, Microsoft's contender requires an add-on to get the physical keyboard, and convertible notebooks, those serving both notebook and tablet functions, haven't done so well in the Windows PC world. Worse, a Surface 3 costs more than any comparable MacBook Air and, in fact, can be optioned up to the point where the price matches some configurations of the 15-inch MacBook Pro with Retina display.

    Do you wonder which computer customers will prefer?

    Evidently Microsoft still doesn't get it, and it recalls the statement from Steve Jobs so long ago that the company doesn't have any taste. In a sense, then, Microsoft products lack soul, and thus are less aspirational products than ones you buy of necessity. You need Office for work, although you can get a perfectly usable version for a Mac or an iPad. But Microsoft's hardware isn't doing so well, except for the xBox.

    But don't forget that Microsoft dumped billions into the Xbox before the product became profitable, and those profits still won't add up to the money lost over the years. But since it all got buried in the tax returns, maybe it doesn't matter.

    What does matter, or should matter, is that Microsoft demonstrates conclusively that hardware isn't their bag. Having spent over $7 billion to acquire the Nokia handset division, though, it means that Windows Phone isn't apt to be discontinued anytime soon. A hefty portion of Nokia's employees, however, are getting pink slips, so it may be the death of a thousand cuts.

    Remember, though, that the decision to buy Nokia was made by former CEO Steve Ballmer, not current CEO Satya Nadella. It's not that Nadella can easily untangle this mess, and I suppose the division could some day be profitable, since a Lumia smartphone is actually pretty decent.

    It's just that the public hasn't shined to Windows Phone, which remains an afterthought when pitted against gear from Apple and Samsung. Sure, perhaps the Cortana voice assistant, as claimed in those ads, does more things better than Siri, but that may not be sufficient to persuade people to switch from iOS.

    One article I read recently suggested Microsoft would do best to dump the Surface and Nokia products. I suppose, after things settle down, Microsoft could pawn off the latter to another company, as Google did with Motorola Mobility. But it seems as if Nadella would still want to retain the Xbox. After all, the losses are history, so why not mine the potential profits as long as possible?

    Still, the lion's share of profits come from Windows and Office. Windows 8 is getting shellacked in the court of public opinion, although sales remain decent. But many new PCs, particularly those purchased by businesses, are promptly downgraded to Windows 7.

    Yes, there's a Windows 9 on the horizon, and the first public beta may be out soon. So far, however, the feature set appears to be less than compelling. There will be a normalized Start menu, and greater emphasis of the desktop. So maybe Windows 9 will be designed to be somewhat of a descendant of Windows 7, although the interface formerly known as Metro isn't going away.

    Supposedly the interface that gets prominence will depend on whether you're using a traditional Windows PC, or one with touchscreen capability. But homes and offices with the latter will often have the former at hand too, meaning there's apt to be lots of confusion when switching from one device to the other.

    Compare that to the way Apple is handling integration of iOS and OS X, where, when possible, apps will carry the same names, and, with iOS 8, Yosemite and Continuity, they will work closely together. Apple's notebook keyboards have essentially the same feel as their traditional desktop keyboards, again to reduce the time to relearn the feel and thus make you a more accurate typist and thus more productive.

    These are things, however, that aren't on Microsoft's radar. Still, it's early in the game for Nadella, and maybe he'll be more apt to make significant changes over time to set things right, at least if he understands what's wrong.



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    One Response to “The Microsoft Death Watch: In Search of a Strategy”

    1. DaveD says:

      As you have clearly pointed out with examples, Microsoft doesn't possess what Apple has for a long time, laser-guided focus. Apple had never said no to a larger iPhone for the main goal is to deliver the best user experience such as the touch of quality, ease of use, and good performance. You see the same on the Macs, iPads, and iPods,

      I don't know where Microsoft wants to go with its heavy baggage.

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