Microsoft’s Momentous Move(s)

Published September 6, 2013
A man uses the camera of a Nokia Lumia 820 smartphone as he poses in this photo illustration taken in the central Bosnian town of Zenica, September 3, 2013. — Reuters Photo
A man uses the camera of a Nokia Lumia 820 smartphone as he poses in this photo illustration taken in the central Bosnian town of Zenica, September 3, 2013. — Reuters Photo
Microsoft CEO Steve Ballmer shakes hands with Nokia's Chairman of the Board Risto Siilasmaa (R) during the news conference of Finnish mobile phone manufacturer Nokia in Espoo, September 3, 2013. — Reuters Photo
Microsoft CEO Steve Ballmer shakes hands with Nokia's Chairman of the Board Risto Siilasmaa (R) during the news conference of Finnish mobile phone manufacturer Nokia in Espoo, September 3, 2013. — Reuters Photo

Many words are being written around the world today about Microsoft’s $7 billion dollar acquisition of Nokia’s Devices Unit. Tech publications are dissecting the chronological events leading up to the announcement, and speculating who the next CEO is going to be, which was Microsoft’s other big announcement last week.

After failing to proactively manage the shift to mobile, the questionable strategy behind the Surface tablets and the subsequent (almost) billion dollar write off, the obfuscation of Windows 8, the substantial corporate restructuring, the earlier-than-expected retirement announcement of the veteran CEO, It doesn’t really matter who stands at the helm to execute; the strategy must be complete and cogent.

The executor simply has to be receptive, patient and resolute. The trouble is that in the tech industry, the strategy usually stems from the CEO. Steve Jobs and Jeff Bezos of Amazon aren’t touted as visionary leaders only for their ability to lead a company, they’re also held in high esteem because they waited for their convictions to be ultimated.

The writing’s been on the wall for a long time, and while parsing through Microsoft’s investor slide deck pertaining to the acquisition, I stumbled across an interesting snippet which, to me symbolizes a change in stance; a willingness to expunge the old and adopt a riskier, comparatively cavalier attitude.

On slide 15, where they present their rationale for pursuing phones, the second line states “With the consumerization of IT, users matter at both home and work”

This acknowledgment belies everything the outgoing CEO stood for. Whether it was a systemic belief or not, It was almost certainly at the crux of every major decision made at Microsoft over the past 5 odd years, if not more. Microsoft only laid emphasis on the enterprise customer.

Just as Ballmer’s now-famed video response to the iPhone was the prodrome to an enterprise-centric strategy, this little acknowledgement may portend a more uninhibited Microsoft. With Blackberry reportedly up for sale, Facebook failing in it’s mobile adventures, WebOS seemingly incapacitated, the next 12 months should feature passive-aggressive plays by Microsoft, Apple & Google.

The field is plateauing a little with all three having internal hardware and software capabilities, and the battle for exclusivity should heat up, since the form factor and pricing is now almost ubiquitous.

A couple of wildcards do exist - Amazon and Yahoo to name a few - but along with them, a tremendous opportunity to buck the trend and go local in emerging markets (Xiaomi?) Google will probably spend much of it’s development time on consolidating and bringing uniformity to Android’s fragmentation in the forthcoming KitKat update.

Yahoo continues it’s impressive renaissance, but it will be interesting to see where Marissa Mayer’s loyalty lies; whether she is resurrecting Yahoo for the long run or priming the proverbial pig for slaughter (Yahoogle? Goohoo?)

Microsoft’s entire existence and success had been modeled on a rhythm which Apple and the mobile space disrupted. To find a new, harmonious cycle will take time, innovation and a presence in the mobile space. Microsoft has a trump card which it can use to accelerate adoption, but it would be a far gutsier move than they may be willing to make as it involves cannibalization.

Microsoft could bundle Office, one of it’s largest revenue generators, for free with every mobile device without asking customers to purchase a license. Coupled with refreshing design, a few fantastic first-party apps and very boisterous yet lucid relaunch, they can catapult themselves back to relevance and regain a fraction of that lost momentum almost immediately.

Steve Jobs famously said he wasn’t averse to cannibalization, because he’d rather do it to himself than have someone do it to him. An attitude as such is borne of an unending reservoir of self-belief. That is the single most important trait Microsoft’s next leader should have.

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