Microsoft At A Crossroads With WP7
<div class='os_post_top_link'><a href='http://www.businessweek.com/news/2010-10-04/microsoft-cut-from-goldman-buy-list-on-mobile-weakness.html' target='_blank'>http://www.businessweek.com/news/20...e-weakness.html</a><br /><br /></div><p><em>"Microsoft was removed from the bank's Americas Buy List, with a price target of $28 rather than $32, Goldman Sachs analysts including Sarah Friar wrote in a note to clients. The company needs to win "a firmer foothold in the growing migration to mobile devices" in order to improve investor sentiment, they wrote...Microsoft has struggled to match mobile offerings from rivals including Apple Inc. and Google Inc., whose Android software powers high-end phones and tablet computers. Redmond, Washington-based Microsoft has yet to release a tablet computer to compete with Apple's iPad, 3 million of which were sold in the first 80 days of its release."</em></p><p>That this comes right on the eve of Windows Phone 7's launch next week points to continuing scepticism of how much of the ground Microsoft lost in the last 3-4 years they can recover. Microsoft is at a crossroads - it's make or break time. If Windows Phone 7 turns out to be a failure, that might be a blow from which Microsoft might not recover from. Office and Windows remains MS' bread and butter, but the computing world is evolving ever more rapidly and if MS can't build a solid presence in the mobile space, they risk becoming irrelevant.</p><p>Even if WP7 turns out to be a middling success among consumers, there's going to be consequences, and heads are going to roll. Ballmer's already feeling the heat, based on this report from <a href="http://www.windows7news.com/2010/10/05/kin-failure-cuts-ballmers-bonus/" target="_blank">Windows7News.com</a> (you can view the original documentation <a href="http://www.microsoft.com/investor/proxy/Compensation Discussion and Analysis.html" target="_blank">here</a>):</p><p><em>"According to Microsoft's Definitive Proxy Statement for this year, Ballmer's maximum potential bonus was 200% of his $670,000 base salary, but his actual bonus turned out to be just 100% of his base salary. Listed as reasons for this cut were the Kin's failure, 'loss of market share in the company's mobile phone business,' and 'the need for the Company to pursue innovations to take advantage of new form factors,'..."</em></p><p>This next year will be critical for both the company - and its existing management. Either the former changes for the better, or shareholders will make sure the latter will.</p>
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