When will Microsoft regain its identity?
Remember the days when everyone knew that Microsoft was a software company? The company's focus was placed squarely on Windows, Internet Explorer, and Microsoft Office, and no one even considered the possibility of it becoming an online firm or providing any other service outside of the software industry.
But now, everything is different.
Instead of focusing all its attention on the software space, Microsoft has decided that it needs to split its attention into different markets in order to stay successful in the industry. Now, it's not only a software company, but it runs a video game business, and has consistently tried to cement itself in the online space. And even in that online space, it can't decide if it wants to focus all its time on Live Mesh, search, or advertising.
Microsoft focusing its attention in other markets isn't necessarily a bad thing. After all, it's one of the most important and prominent companies in tech and to think that it shouldn't expand outside software is ludicrous. But the main problem I have with Microsoft's identity problem is that it doesn't know how to focus.
Is Microsoft a software company or is it a video game company? If it's neither, is Microsoft an online firm that wants to compete with Google? At this point, Microsoft would probably say that it's all of those. But in reality, I just don't think that the company has what it takes right now to successfully manage all three segments.
As a software company, Microsoft is wildly successful. It's still the de facto leader in the operating system market and Office is still the chosen standard for businesses and students, alike. And if Microsoft focused all its attention there, it would probably be just as successful.
But it decided (rightfully so) that the future is on the Web and so, in an attempt to capitalize on that, has started to shift its focus away from software and place it squarely on the Web.
Back when Microsoft decided that software was central to its success, it allowed companies like Google and Yahoo to capitalize and gain a stranglehold online while it maintained its lead in the software market. But after realizing it was making a mistake, it started a few years ago to focus its attention online and try to make up lost ground.
And given its laughable search market share and its inability to make any headway in the advertising market, I think it's safe to say that Microsoft committed a major blunder.
And now, it's happening all over again.
As soon as Microsoft started focusing most of its attention online, Apple gained significant ground in the OS market. For years, Apple was allowed to run roughshod over the OS space and win a PR battle that Microsoft didn't even know it was fighting. And thanks to the constant hounding of Mac vs. PC ads, the mainstream was made aware that Microsoft wasn't holding up its end of the bargain with Windows.
Suddenly, after allowing Apple to operate unabated for so long, Microsoft had an epiphany and started airing ads to compete with Apple and help fix some of the negative PR it was experiencing with Vista.
But once again, it was too late.
Aside from Windows and Office, Microsoft isn't a leader in any other major market it competes in. Sure, it's a player, but whether it's video games or it's search, Microsoft can't establish itself as the leader in any other sector.
Now, I'm not suggesting that Microsoft should go out of other markets just because it's not the leader, but I think it needs to decide what kind of company it is. Apple has decided that it's a hardware firm, Google has decided that it wants to stick with online services and mobile platforms. Microsoft has decided that it wants to compete in practically every market, but it's abundantly clear that it simply can't--it focuses too much of its attention in one place and loses ground elsewhere in the process.
With all these issues, Microsoft is still an incredibly successful company and we can't lose sight of that when comparing it to others in the industry. But I do think that it's fair to say that Microsoft executives and management simply aren't capable of juggling two things at once and that could eventually lead to its downfall.
Running a business in one market is tough enough. But if you decide that you want to compete in other industries, you better be prepared to manage each part of your business as effectively as possible. If you can't, it will come back to haunt you.
And for all its profit and all its cash, I think Microsoft is learning that lesson right now.
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Don Reisinger is a technology columnist who has written about everything from HDTVs to computers to Flowbee Haircut Systems. Don is a member of the CNET Blog Network, and posts at The Digital Home. He is not an employee of CNET. Disclosure.
Other companies have managed to have similar successes in multiple markets, but as you (Don) pointed out, they still manage to keep it in a somewhat specific genre.
Microsoft OTOH doesn't have the culture, structure, or leadership required to keep discipline even within one genre - yet here they are throwing themsleves all over the map. A partial list of their ventures outside of Windows/Office since the mid 1990's include, with varying degrees of success:
* DVRs
* ISP services
* Peripherals
* Consoles
* Web/Television appliances
* Web services/servers
* programming languages (by comparison, note that Apple still uses either Obj-C or industry std. languages)
* "Surface" kiosks
* Mobile software/OS
* PC games
* databases
* game consoles
* graphics programs
* home networking hardware
* antivirus
* cloud services
* virtual machines
* tablet machines
* portable media players
...etc...
Little wonder that they're in last or next-to-last place for those projects up there that haven't died off and aren't very close to Windows.
This is nothing against MSFT at all, mind you - no corporation could reasonably be expected to maintain a presence in the markets that those products (and many more) penetrate and do much more than muddle along. It also serves as a distraction ( a HUGE distraction) from the company's core business.
Personally, I'd love to see MSFT kill off (that's right, kill) any of the above projects that either a) isn't already dead, or b) doesn;t have anything to do with Windows (either front of back end).
Things like Exchange and MS SAL Server? Okay - those have relevance and they're not money pits. Xbox? Maybe, but it had better start turning a profit sometime soon, start paying as it goes.
Windows Mobile? Kill it. MSFT has had eight years (a veritable geological epoch in tech timescale), only to see first RIM, then Apple stomp them flat. Peripherals? They're more often than not re-branded Logitech (and various other) products anyway - there can't be enough profit in them to make it worthwhile...
MSN the ISP? Needs to die, or get sold to Qwest (which is about the only reason it still has any life left in it). MSN the search engine? Sell it to Yahoo, or split it off to whatever minor CxO wants to make a go of it. The Web is a good market, but there needs to be some intelligence in what MSFT chooses to do to make themsleves a part of it... maybe something ASP-oriented.
Ditch. The. Rest. Tablets are niche, underpowered, and aren't worth the time. Concede the VM environment to VMWare and Citrix/Xen... they're already light-years ahead in features, reliability, and nearly every other metric you care to use. Otherwise Hyper-V will be in the VM markets what MSN is in the search engine market: "Also Ran", "Third Place and Falling", etc.
Finally, MSFT needs to stop chasing Apple, Oracle, VMWare, Google, etc etc etc... Letting yourself be defined by others' successes means that you end up not only failing, but in the eyes of consumers actually look like a failure at the same time.
Apple has successes in the markets the put serious effort into because they choose wisely, then come out with something that doesn't imitate what's there, but instead innovates and redefines the market. The iPod blindsided everyone. The iPhone was pooh-poohed and called a failure by nearly every soi-disant "pundit" and "expert" out there - only to shatter records and force a lot of tech pundits (and more than a few MSFt cheerleaders in here) to eat a metric ton of crow. Apple didn't do it by merely making an analog of what was already out there, but introduced a package that even now, the competition is now furiously trying to emulate.
Microsoft needs to do that. They need to find an emerging market that has a bunch of small players in it, then create something innovative and different enough to get attention AND to draw in interest... Make the product rock-solid (I know, I know), and they'd own the market.
The trick is to actually, you know - do that.
/P
* Peripherals
* programming languages
* PC games
* databases
* game consoles
* cloud services
* virtual machines
* tablet machines
* portable media players
1. MS has never really succeeded in anything that was not tied into the Windows Lock-In Program ™ The only possible exception is the XBOX, but is riddled with problems and red ink.
2. MS does not understand the Internet or the Web. They don't understand why things work and why others don't. They are blindly chasing trends. Throwing as much crap on the wall to see what sticks.
3. They seemed to have lots focus on what an OS does and what it should or shouldn't provide. Blindly following the trend setters(OSX, and Linux) is the same problem in #2. Of course, they still lack any sort of concept of privacy, performance and security. Which is why Vista is such a mess.
Since all they do is copy, MS would do well to follow Apple and ditch the legacy crap that infests XP and Vista and start over.
2. I'm pretty sure that with all the smart people the Microsoft has, they understand the web just fine. It's just that they don't do a very good job of communicating all of their services and how they work together. Although I do kind of agree that they do seem to be chasing trends a bit.
3. The truth is that none of the OS' is a real trend setter. Apple and Linux both heavily copy off Microsoft and in general everyone is trying to copy off everyone else. Also, I think that Vista is actually very good as far as privacy and security is concerned. Obviously performance will be a little slower than XP on older machines, but you can't ask for more stuff without paying the price. My $550 laptop runs Vista beautifully.
Oh, and if Microsoft ditched all the legacy stuff, I think that would mean the end of the world or something.
I don't like their products.
But I admit that I am forced to use Windows and Office, hopefully for not too long.
I choose Chrome and Google docs for myself and perhaps Android too.
I am not an Apple fan boy, but Steve Jobs was right, Microsoft has no culture. They just aren't cool and have no wow factor.
Apple does tightly integrated hardware and software, something no one else offers - that's what differentiates them in the market.
Really?
Since when does putting together hardware that others designed and manufactured make them a hardware company?
You can call them that when the design their hardware, not just put it together.
The term you are looking for is OEM.
You make it sound as if Apple owes its success to Microsoft. That is only partially true. Mostly the credit belongs to Apple. They made some difficult choices in abandoning their internal OS efforts (Copland), switching to an outside company's technology (NeXT), embracing open source, and delivering a secure and reliable OS to their customers. All of that would have happened regardless of Microsoft getting distracted by their Internet endeavors.
I loathe microsoft, they are not good in any single market. They have not shown even a single little shard of innovation or great design, every single damn little thing they make is either bought out from ofther companies (thanks to deep pockets) or just simply copied over. Let me makes a few examples:
Windows OS basically copied off of the earlier apple OS then Vista again copies over Mac OSX
The Zune basically an Ipod with an added feature or two with the microsoft logo
Microsoft Office, bought off from a small company
the Xbox 360, whose 1st party software were bought by microsoft and whose 3rd party developers were whooed by large sums of money
and also microsoft should stop their stupid I'm a PC ads because they are so SO annoying, we don't use PCs because we would like too but because we HAVE to.
- by mewt2o October 26, 2008 1:48 PM PDT
- I see a lot of things wrong with this article and I would suggest people actually do a little research for themselves before blindly following it. It seems the author doesn't have a good grasp of all of Microsoft's services and to say that it's not a leader in anything but Windows is very mistaken. While it may not be "the" leader in everything, most of Microsoft's offerings are very competitive with the top player.
- Like this Reply to this comment
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(20 Comments)Microsoft's Live online services are some of the very best out there. They even have many advantages over some of Google's offerings because they do an incredible job of tying your PC, Laptop and Mobile Phone together. The author mistakenly summarizes Microsoft's online initiative as Search and Advertising, but that doesn't even scratch the surface of everything they do. You can tell the author doesn't have too much knowledge about this when he refers to Live as Live Mesh (Which is just a platform for other services and not a real service by itself).
It's hard to deny that XBOX is definitely a market leader. It may be outsold by the Wii, but in just 2 generations it already left the previous market champion in the dust. It's XBOX live service is, without a doubt, currently the best online service available for a console. Also, as a side note, Microsoft has been in the video game business for quite a while, even way before XBOX. Don't forget that Microsoft has been making PC games for years and the author forgets, games ARE software.
This article is also hardly thorough. It doesn't even mention any of Microsoft's other divisions such as Zune and Windows Mobile (the former being very good and the latter being in need of some serious work). Anyways, it makes a few good point, but definitely more mistakes.
And just in case, I'm not a Microsoft fanboy (do those even exist?) I use Linux, Mac and Vista. I also have never owned an XBOX although I play it often enough (I prefer my Wii). I just think that Microsoft has turned into everyone's punching bag and that no matter what they do, people will just complain about it.