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  • So Microsoft Needs Apple After All

    March 19th, 2014

    So the news came this week that Microsoft’s stock has ticked up. Part of an overall trend, or did something happen to increase optimism about the company? Has newly-minted CEO Satya Nadella announced something really special?

    Not exactly, although there’s plenty of anticipation, particularly now that Microsoft’s note-taking app, OneNote, is now available for OS X Mavericks users — and it’s free!

    Now there are already comparisons between OneNote and Evernote, considered the standard bearer in that category, but I won’t bother reviewing them, since they aren’t the sort of apps that I’ve ever used. But if you do, you can’t argue with free. It does seem, though that OneNote is well designed, snappy and apparently reliable, so it’s a plus for Microsoft. Snappy and reliable are not words that are often used for their products.

    Regardless, the stock price probably didn’t go up because of OneNote, although its arrival had been anticipated. It seems to be more about a Microsoft “mobile first, cloud first” media event. featuring Nadella, which is scheduled for March 27 in San Francisco.

    According to the rumor mill, Nadella will use his first major press meeting to announce the impending arrival of Office for the iPad. If true, that would be a huge deal for a number of reasons, since the iOS version of Microsoft’s office suite has been in hot and cold mold since 2011. It was expected then, and has been expected from time to time since then.

    But Microsoft has been hoping and dreaming that customers will be lining up to buy Surface tablets, and similar gear from other PC OEMs, because they alone offer a full Office suite on a mobile platform. But people aren’t lining up. It doesn’t seem that having Office has helped sell a Surface, nor has the lack of Office hurt sales of the iPad.

    Indeed, iPad users have choices. Number one with a bullet is Apple’s own iWork suite, which is free with the purchase of a new Mac, iPad or iPhone, and updates are free with existing gear if you own the previous version. Microsoft may find it advantageous to make OneNote free, but making Office free for iOS would put a stake in the heart of a huge potential income stream.

    When you consider the vast user base of iPads, Microsoft could be losing out on billions of dollars of potential sales, and that’s nothing to sneeze at. Despite the alternatives, there is still a hefty customer base of Office users, and if Microsoft does a decent job at delivering the iPad version, and keeps it affordable — though it’ll probably require an Office 365 subscription — it could chalk up high sales.

    Sure, I suppose it is possible that time has really passed Microsoft by. If they cannot succeed with an iPad version of Office, it would indeed raise question marks about the company’s ongoing strategy, such as it is.

    Of course, it’s not 100% certain that a an iOS app suite will be announced at next week’s session, but Microsoft isn’t as good as Apple in keeping secrets. There are enough hints out there to give the possibility a lot of credibility. This move, which has allegedly been alternately approved and rejected in the past three years by former CEO Steve Ballmer, might also signal a huge change on Nadella’s part to embrace a philosophy that extends Microsoft’s software to other platforms and opens up greater revenue opportunities.

    It is also reported that Microsoft is working on a 2014 of Office for the Mac. And it would be about time. The 2011 release, first announced in 2010, has been hit or miss. It’s clunky, seems old fashioned already, and the email client, Outlook, remains barely functional.

    I wouldn’t presume to guess how customers will react to the next Mac version of Office, but I would hope Microsoft would pay more than lip service to Mac-only and make more than a passing effort to rid the suite of long-standing performance bottlenecks. Despite claims of recoding Office 2011 using the latest Apple technologies, the end result was decidedly underwhelming. I wonder how many Mac users even consider Office anymore, except for those migrating from the Windows platform who seek something familiar.

    Overall, Microsoft would probably do far better working with Apple as much as possible. Google is trouncing Microsoft on search, has a mobile platform that makes Windows Phone an afterthought, and an online app suite with a growing number of users. Microsoft’s efforts to go it alone haven’t done so well. PCs are yesterday’s news, the purchase of Nokia’s handset division may do as little for Microsoft as Motorola Mobility did for Google before being dumped.

    If Microsoft can’t build tablets people want to buy, what’s left? Well, emphasizing cloud-based services, such as Office 365, and making iOS versions of key apps, could help jumpstart sales. Even if fewer people care about Windows, if Microsoft can sell apps and services to a wider audience, it still means high revenue and profits. It’s hard to complain about that, even if Apple benefits too.

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