Edit: I spent a little more time reviewing Nadella’s email, and I’m not sure that I agree with ZDNet’s interpretation. So, I’m adjusting my post to better reflect my own interpretation (which I should have done in the first place).
ZDNet published a fascinating article outlining CEO Satya Nadella’s vision of a new Microsoft, one that is focused on “productivity and platforms” going forward. As I review Nadella’s email myself, I come to some different conclusions than they seem to arrive at.
According to Natella:
At our core, Microsoft is the productivity and platform company for the mobile-first and cloud-first world. We will reinvent productivity to empower every person and every organization on the planet to do more and achieve more.
What I find most interesting is that Microsoft places productivity and services, what they frame as “Digital Work & Life Experiences,” at the core of their strategy. “Device OS & Hardware” and “Cloud OS” extend off of this core, meaning that products like Windows, the Surface line, smartphones, and others don’t appear to be central—and pushing Microsoft’s productivity products, like Office and Azure, to other platforms might be more important than in the past.
In the past, I’ve assumed that touch-centric versions of Office have hit Android and iOS before Windows 8.1 simply because there’s already a version of Office that runs on Windows. Now I’m not so sure. I don’t think Microsoft will necessarily push cross-platform support before fleshing out their “one operating system, many devices” vision, but perhaps those other efforts will gain equal standing.
Nadella does say this about Microsoft’s first-party hardware products:
Our Windows device OS and first-party hardware will set the bar for productivity experiences. Windows will deliver the most rich and consistent user experience for digital work and life scenarios on screens of all sizes – from phones, tablets and laptops to TVs and giant 82 inch PPI boards. We will invest so that Windows is the most secure, manageable and capable OS for the needs of a modern workforce and IT. Windows will create a broad developer opportunity by enabling Universal Windows Applications to run across all device targets. Windows will evolve to include new input/output methods like speech, pen and gesture and ultimately power more personal computing experiences.
Our first-party devices will light up digital work and life. Surface Pro 3 is a great example – it is the world’s best productivity tablet. In addition, we will build first-party hardware to stimulate more demand for the entire Windows ecosystem. That means at times we’ll develop new categories like we did with Surface. It also means we will responsibly make the market for Windows Phone, which is our goal with the Nokia devices and services acquisition.
For someone who’s been making a serious investment in transitioning to all-Microsoft products, I find this encouraging, to say the least. It seems that Microsoft isn’t going to abandon Windows or Windows Phone, but rather they will strive to both build out their “one operating system, many devices” strategy while at the same time pushing their information and content products to other platforms.
Nadella is quite serious about this new strategy:
Nothing is off the table in how we think about shifting our culture to deliver on this core strategy. Organizations will change. Mergers and acquisitions will occur. Job responsibilities will evolve. New partnerships will be formed. Tired traditions will be questioned. Our priorities will be adjusted. New skills will be built. New ideas will be heard. New hires will be made. Processes will be simplified. And if you want to thrive at Microsoft and make a world impact, you and your team must add numerous more changes to this list that you will be enthusiastic about driving.
What this means is that Microsoft is now essentially positioning itself more squarely against Google, pitting its own information properties directly against Google’s in many areas. Skype Translator goes up against Google Translate, Cortana goes up against Google Now, AzureML machine learning goes up against Google’s well-established back end. Nadella specifically mentions OneDrive, OneNote, Office, Bing, and Dynamics as part of the mix, which demonstrates the breadth of Microsoft’s foundation.
Overall, I’m a bit conflicted about this new strategy. On the one hand, I think it’s quite compelling, and likely represents the right direction for Microsoft’s future success. While I don’t want my investment in Microsoft products to go to waste, I do recognize that while Microsoft needs to both push forward with their vision of making Windows work on any kind of device, they also need to support the real world where Android and iOS dominate. Simply put, maybe they simply can’t bet the farm on Windows and Windows Phone being successful.
The potential downside to the strategy is that Microsoft is depending on their core services being competitive against Google’s. In the past, this has been a dicey proposition—Bing Search, for example, hasn’t been terribly successful competing against Google Search (as nobody has been). On the other hand, Xbox and Azure, along with Microsoft’s general strength in the enterprise and the productivity products mentioned above, are real and unique strengths that Microsoft can leverage. Really, all of this points out just how complex and dynamic is the technology industry today, and how a company like Microsoft has to continually adjust its strategy to remain relevant.
For me personally, the future that Nadella paints is unclear in its benefits. I want the vision that Microsoft has outlined in the recent past, where Windows thrives on any possible kind of device and where I can enjoy a consistent user interface and backend services on everything from my desktop to my smartphone. I don’t really want to use Windows on most of my machines and then Android on my smartphone, any more than I want to use OS X and iOS or Chromebook and Android, no matter how well Microsoft’s information and content properties are supported. After all, up until now, I’ve been fine using Google Search, Chrome, Google Music, Google Maps, etc., and as I’ve been using Microsoft’s properties over the last few weeks I haven’t that many advantages to doing so.
Nadella doesn’t say specifically that Microsoft won’t try to deliver what I’m looking for. But, the strategy that he lays out is a bit more nuanced in terms of where Microsoft’s own hardware and information products are concerned:
While today many people define mobile by devices, Microsoft defines it by experiences.
I don’t want to take anything out of context, but one can read that sentence to support the idea that while Microsoft will continue to innovate in terms of hardware, they’ll also continue to push their software properties onto other platforms. I think they’ll be challenged to both build a market for their own hardware while creating value on other platforms.
Ultimately, given this new strategy, Microsoft will have to leverage every strength they have to be successful, something they haven’t necessarily stressed in the past few years. Consider Xbox, which Nadella specifically called out:
Xbox is one of the most-revered consumer brands, with a growing online community and service, and a raving fan base. We also benefit from many technologies flowing from our gaming efforts into our productivity efforts – core graphics and NUI in Windows, speech recognition in Skype, camera technology in Kinect for Windows, Azure cloud enhancements for GPU simulation and many more. Bottom line, we will continue to innovate and grow our fan base with Xbox while also creating additive business value for Microsoft.
That’s encouraging, because it means that, finally, Microsoft might pull together as a single company and leverage all of their efforts toward a single set of objectives. I remember how Office never did fully support the pen on the Tablet PC platform, and how this limited the value of both. If Microsoft can convince their various teams to work together, then I can see this new strategy being successful.
I’ll be keeping a close eye on things. I don’t believe, or perhaps don’t want to believe, that my investment in the Surface Pro 3 and Lumia 925, in terms of money, and in all Microsoft products (Bing, Internet Explorer, etc.) in terms of time and effort, will be wasted. I think that Microsoft still sees a unified Windows as key to their long-term success, and that supporting other platforms does not mean abandoning their own.
I said this before and I’ll say it again: I could switch back to using my Nexus 5 to go along with my Windows desktop, hybrid, and tablet, but I don’t really want to do so. And as Google builds out Chromebook and continues to add tremendous value to Android (Android L is looking like a powerful platform), I think that Microsoft needs people switching to Windows Phone from Android to be successful over the long term.
What do you think? Are Bing, Xbox, Office, Azure, and other Microsoft information and content products enough to compete against Google (and Apple)? Or does Microsoft need Windows running on every device (and gaining market share) to survive?