Microsoft Missteps – Get Your Act Straight, Microsoft! As we hurtle towards the year 2014, it seems this past year has so far only increased uncertainty in the future of consumer technology.
While the typical buyouts and acqui-hires have continued – spearheaded by Yahoo – the roadmap for some of the largest technology companies in the industry remains unclear. The sands are shifting and while these shifts are ephemeral, they often displace the components thereby altering the dynamic, and the future.
Microsoft has been having a torrid time over the past couple of months. It’s been in the limelight for all the wrong reasons, and one would be more forgiving it was a relatively young company devoid of much experience. It all started with the Xbox One used games (DRM) and online check-in debacle – two new features of the imminent video game console that mandated the system be connected to the internet at all times, and also disallowed the sale of used games.
After severe consumer backlash, despite an initially rigid stance, Microsoft backtracked and changed its policies, especially after Sony unveiled that their next-generation offering will impose no such limits. They were also bested by Sony in terms of pricing and graphics performance, which has now led Microsoft to announce that they are enhancing the specifications of the console to make it more competitive with Sony’s PlayStation 4. This becomes a lose-lose proposition for Microsoft as they either look disconnected and unresponsive to their customers, or copycats of their biggest competitor.
The perplexing part is that, much like a lot of its recent blunders, this seems to be a self-inflicted wound borne of dubious corporate strategy.
Many were pleasantly surprised when Microsoft unveiled their Surface tablets and entered the immensely competitive and evolving tablet market. The announcement didn’t reveal a launch date or a price point, but did state that two variants would be launched; one which would support legacy desktop apps and ensure interoperability with desktop programs that people were used to, and a new AT variant which would only work with new apps from the Windows Store.
Sales have been lackluster and that has led to the write-off of approximately 900 million dollars worth of its first batch of Surface RT tablets; an occurrence which does not inspire a lot of confidence in Microsoft’s strategy and hardware. Perhaps a better move would have been to work closely with Nokia, and launch a Surface Phone first in an industry where multiple platforms are proven to work. Both the companies could have concentrated on core efficiencies and introduced something significant to show their recent alliance.
The Windows Phone division isn’t faring much better with Instagram users reporting that images uploaded from a Windows Phone device using Instance, an unofficial Instagram app, are being deleted by lnstagram. Google, which had initially blocked its Map service for Windows Phone users, has also blocked the latest YouTube app saying it violates their Terms of Service. The app was being developed by Microsoft and Google jointly. Google has also extended its deadline to support Microsoft’s Exchange ActiveSync protocol.
When Google, a web services company, starts issuing ultimatums to Microsoft, it appears as if Microsoft is peddling obsolete technology. Even Nokia has expressed their dissatisfaction with the Windows Phone ecosystem as a whole.
Microsoft’s web services division isn’t immune either. BBC reported that BskyB has made Microsoft change the name of its cloud-based storage offering Skydrive. Bizarrely, the new Outlook.com still doesn’t have IMAP support, which means that third-party apps can’t get access and support for Outlook; which in turn means, that apps like the immensely popular Mailbox for iOS cannot exist for Windows Phone and cannot promote the ecosystem.
While all this illustrates the problem, it also encapsulates the solution: Microsoft needs to have apps in its ecosystem which are deemed absolutely compulsory by Smartphone users today.
Many users don’t see a reason to move to a Windows Phone despite its modern and innovative User Interface (UI). Ironically, more and more apps on other platforms are adopting Microsoft’s clean and minimalist ‘Metro’ design philosophy, like Yahoo’s latest Weather app for the iPhone, which is much like its excellently redesigned Flickr app, has won critical praise across the spectrum.
This begs the question: if a teetering giant like Yahoo can take strides to become relevant again, how can Microsoft find a way to stay relevant. The answer is simple and one that Microsoft already has, Halo. Microsoft’s exclusive arrangement with Bungie, the developer of Halo, catapulted the Xbox to the forefront of the video game industry, and has undeniably helped it stay there for over a decade.
Microsoft needs killer first-party apps exclusively for Windows 8 and made by Microsoft- owned studios for its ecosystem to grow. While it’s no secret that Microsoft has paid developers to build apps, that makes it sound more like Blackberry’s strategy, and less like Yahoo’s, that has gone on a buying spree of successful commercial businesses for immediate traction, and defunct companies to acquire, hire and retain the development talent.
If Steve Ballmer doesn’t want Microsoft to become the next Blackberry, he needs to devise a better, coherent strategy and combine that with intelligent acquisitions.
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