Microsoft At A Crossroads With WP7

[Nurhisham Hussein]

<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.&nbsp; Office and Windows remains MS' bread and butter, but the computing world is evolving ever&nbsp;more rapidly&nbsp;and if MS&nbsp;can't&nbsp;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&nbsp;are going to&nbsp;roll. Ballmer's already feeling the heat,&nbsp;based on&nbsp;this report from <a href="http://www.windows7news.com/2010/10/05/kin-failure-cuts-ballmers-bonus/" target="_blank">Windows7News.com</a>&nbsp;(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>

[egads]

Hate to be a downer but from what I've seen of WP7, MS is the roadkill you ran over about a mile before you got to the crossroads. WP7 is way too late, way too hobbled, and just way to weird to be a big hit in 2010/11.

[Macguy59]

Hate to be a downer but from what I've seen of WP7, MS is the roadkill you ran over about a mile before you got to the crossroads. WP7 is way too late, way too hobbled, and just way to weird to be a big hit in 2010/11.

Meh. Not crazy about the tiles homepage but once you drill down past that it's not too bad. At least what I've seen in videos

[alese]

I used an actual WP7 device last week (HTC HD3) and the OS or better yet the UI is really nice.

But with all the limitations Microsoft imposed on the OS/platform and considering the fact that they are way late to the market I think the best they can do is distant third after Android and iOS - provided that they really focus on the OS, have a clear strategy and improve on the current limitations as fast as possible.

Also, Balmer and his team really screwed up Microsoft in last 10 years. If the board will replace him next year it's going to be like 5 years too late. At the end of nineties Apple was on the verge of bankruptcy and Microsoft was the biggest tech company in the world, challenging for the first place in market cap. Now Apple is undisputed king on stock market and on the market and Microsoft is putting out a "copy" of an Apple product 3 years too late.

[Stinger]

I disagree that it's too late for Microsoft. The market is still expanding rapidly and there's many more new customers to win than existing users.

However, I do think that Microsoft will need to grow significant marketshare (~25%) within 2 years if they're going to succeed in the long term. If the market continues growing at it's current rate, that equates to shipping 25 million units a quarter by Q3 2012. That's a big challenge.

[randalllewis]

I am going to risk a pause to this bash-fest, which is just all too common on tech blogs these days. The tech blogosphere is rapidly developing the infamous mindset of the Washington beltway which is forever pronouncing what the conventional wisdom is and is forever completely wrong.

The danger is tech bloggers and their faithful commenters become an echo chamber where they post what one another are saying about a topic (in this case, the very fate of Microsoft) rather than doing any original thinking on their own.

By far the champions of this is ZD Net. Because of the size of its stable of columnists, it easily becomes its own echo chamber, but it also spills out into the rest of the tech press world.

Added to the heard mentality that is an easy trap for any group of reporters or commentators to fall into is a special, additional, burden for tech bloggers: the inexplicable emotional attachment that humans develop for their purchase decisions, be it gadgets, computer operating systems, cars, or what-have-you.

My point here is not to insult anyone, but just to ask that we take a step back and do some self-evaluation every once in a while. There are some truths that we need to recognize:


Just because I don't like a feature on a smartphone doesn't mean the phone will fail in the marketplace.
Just because I think the privacy policies of a particular company are evil, doesn't mean the company will not be successful.
Just because tech firms often display a swagger and arrogance about their latest software and/or gadget, doesn't mean it is really anything more than just more software and another gadget.
Just because people buy 1 million of something in XX days or download 1 million copies of something in XX days, it really doesn't mean that it is all that important in a nation of 310 million people and a world of 6 billion.
I try to live and comment by these and similar truths. The bad news is: I'm human and sometimes fail to live up to my expectations. The good news is: I try. Jason runs the best tech blogs on the net in terms of the quality of the commentary. It is always a pleasure to visit, even when I think the echos are getting a little loud.

[egads]

I am going to risk a pause to this bash-fest, which is just all too common on tech blogs these days. The tech blogosphere is rapidly developing the infamous mindset of the Washington beltway which is forever pronouncing what the conventional wisdom is and is forever completely wrong.

The danger is tech bloggers and their faithful commenters become an echo chamber where they post what one another are saying about a topic (in this case, the very fate of Microsoft) rather than doing any original thinking on their own.

By far the champions of this is ZD Net. Because of the size of its stable of columnists, it easily becomes its own echo chamber, but it also spills out into the rest of the tech press world.

Added to the heard mentality that is an easy trap for any group of reporters or commentators to fall into is a special, additional, burden for tech bloggers: the inexplicable emotional attachment that humans develop for their purchase decisions, be it gadgets, computer operating systems, cars, or what-have-you.

My point here is not to insult anyone, but just to ask that we take a step back and do some self-evaluation every once in a while. There are some truths that we need to recognize:


Just because I don't like a feature on a smartphone doesn't mean the phone will fail in the marketplace.
Just because I think the privacy policies of a particular company are evil, doesn't mean the company will not be successful.
Just because tech firms often display a swagger and arrogance about their latest software and/or gadget, doesn't mean it is really anything more than just more software and another gadget.
Just because people buy 1 million of something in XX days or download 1 million copies of something in XX days, it really doesn't mean that it is all that important in a nation of 310 million people and a world of 6 billion.
I try to live and comment by these and similar truths. The bad news is: I'm human and sometimes fail to live up to my expectations. The good news is: I try. Jason runs the best tech blogs on the net in terms of the quality of the commentary. It is always a pleasure to visit, even when I think the echos are getting a little loud.

Very good attitude to have. I'm a electrical engineer and we as hole tend to focus on the bad things. We get paid to find and fix bad things. Heck, I've been to meetings that a prize was given out to the person who found the most problems in a design review :)

Again, keep trying to be positive, it may rub off on some of us!
(Altough I still stand by what i said in my orginal post :)

[Sven Johannsen]

http://www.businessweek.com/news/20...e-weakness.html (http://www.businessweek.com/news/2010-10-04/microsoft-cut-from-goldman-buy-list-on-mobile-weakness.html)


"...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."
What are they smoking? Microsoft has never realeased a Tablet, Laptop, or PC of any sort. They write software. Hardware manufacturers put it on devices. MS software has been on tablets since XP. Maybe they weren't the most successful devices in the mainstream, but they saw their niche, and are still being produced. I've owned 5 myself, and everyone has served it's purpose well, and all are still in use. I'll grant that the implementation was not especially touch friendly, but they were stylus friendly. They were, after all, laptops designed with an alternate input option, not a phone blown up to magazine size. I certainly hope MS never releases something to compete with the iPad. If you want competiton in the big phone without a phone space, let android do that. I'm looking for an updated HP TC1100 with Win 7, stylus and adequate CPU, RAM and storage. Maybe the Slate will actually be that. I want to be able to run desktop apps, and handwrite my input when that is appropriate. I have no interest in finger painting my notes.

[Janak Parekh]

Maybe they weren't the most successful devices in the mainstream, but they saw their niche, and are still being produced. This quote highlights it nicely -- Microsoft tried hard to make it a mainstream consumer product, for years, and failed. The market is looking for the Next Great Platform, and it appears that Tablet PC Edition, as it stands, is not it. By all means it doesn't mean that Microsoft should ditch it, but it is not what the market is looking for in terms of a future major revenue source.

randallewis nails it: we need to keep an open mind about the market and the possibilities, and realize we're not always the target market. Have you used an iPad? It's not useful as tablet PC for notetaking, but for certain applications, it's pretty awesome. People keep on slamming it and saying "what can it do that a netbook can't?" Here's one for you: I have push Exchange email to the iPad running all the time. I can turn it on, and in 2 seconds (literally - no resume time and no launch time), check my email, wherever I am, reception or no. Even with push running, the iPad's battery lasts more than 8 hours of sustained use (and many days on suspend), so I never, ever have to carry a charger with me. In fact, I can typically go 2-3 days without a charge. Carrying just the slate instead of something larger with an AC adapter has its advantages.

I'm not saying it's for you, and you should definitely use the tools that suit you best, but I don't see the logic in saying you "hope MS never releases a competitor." The iPad, and possibly Android tablets, has already started subsuming part of the lower-end Windows market, and as such it is definitely competition that Microsoft needs to pay attention to.

--janak

[Fritzly]

This quote highlights it nicely -- Microsoft tried hard to make it a mainstream consumer product, for years, and failed. The market is looking for the Next Great Platform, and it appears that Tablet PC Edition, as it stands, is not it. By all means it doesn't mean that Microsoft should ditch it, but it is not what the market is looking for in terms of a future major revenue source.

randallewis nails it: we need to keep an open mind about the market and the possibilities, and realize we're not always the target market. Have you used an iPad? It's not useful as tablet PC for notetaking, but for certain applications, it's pretty awesome. People keep on slamming it and saying "what can it do that a netbook can't?" Here's one for you: I have push Exchange email to the iPad running all the time. I can turn it on, and in 2 seconds (literally - no resume time and no launch time), check my email, wherever I am, reception or no. Even with push running, the iPad's battery lasts more than 8 hours of sustained use (and many days on suspend), so I never, ever have to carry a charger with me. In fact, I can typically go 2-3 days without a charge. Carrying just the slate instead of something larger with an AC adapter has its advantages.

I'm not saying it's for you, and you should definitely use the tools that suit you best, but I don't see the logic in saying you "hope MS never releases a competitor." The iPad, and possibly Android tablets, has already started subsuming part of the lower-end Windows market, and as such it is definitely competition that Microsoft needs to pay attention to.

--janak

I would not compare an iPad to a notebook; more appropriate would be a comparison with a Tablet, a convertible one in my case, and the list of the iPad shortcomings are substantial: first and foremost is not a substitute for a "portable computer" or a laptop: no Office programs, no way to increase RAM etc.
No handwriting which for me is fundamental, I write much faster and more naturally than typing.
Said that I am not trying to imply that a form like the iPad is a failure, just that cannot be a replacement for a laptop, or better for a Tablet PC, for people travelling for business for example.

[Janak Parekh]

Said that I am not trying to imply that a form like the iPad is a failure, just that cannot be a replacement for a laptop, or better for a Tablet PC, for people travelling for business for example. You're certainly welcome to your opinion on what a useful computing device is, and clearly, for many geeks the iPad is not enough. However, it is a new revenue source for Apple. To excite the market, companies have to be inventing new revenue sources and dealing with competition in those spaces. That's what the comment Sven cited was talking about.

--janak