This post is part of a feature on companies and products that our bloggers think are in need of a makeover. See all 26.
When Microsoft Corp. (NASDAQ: MSFT) released its Windows Vista operating system product almost two years ago, the market was initially excited. That excitement turned to boring indifference as customers, both business and consumer, realized that this was just another update to Windows. Nothing revolutionary, or even evolutionary (in many minds). The problem was this: Windows Vista was a huge change under the hood, but where its users interact with it, it seems like a boring reinvention of an operating system from half a decade ago.
But Microsoft doesn't just make operating systems. It's into the office productivity business (Microsoft Office, anyone), it's big into the mobile business (Windows Mobile), and it's tried desperately to compete with Google Inc. (NASDAQ: GOOG) in the web search advertising business (which has largely failed). So, the company, which continues to make a ton of cash every quarter by selling Windows on all those global PCs that are sold, has no debt and a ton of cash under the mattress. It's still a boring company with a business model that's being made rapidly outdated by the internet and web-based competitors. Should it take its cash, return it to shareholders, and close up shop? Though this was suggested of Apple Inc. (NASDAQ: AAPL) some time back, that company roared back (maybe you've heard). Can Microsoft?
Microsoft has tens of billions in cash and no debt. It can do just about anything it wants. However, the company has been in this position for years and years and nothing new has come out. What is it waiting for? The company seems to not know how to evolve beyond its core businesses that have kept it afloat very well for a very long time -- that's why. The company doesn't get credit for almost single-handedly making personal computing possible to the masses (even though monopolistic tendencies), but it can't move out of that shadow. This is one company that has a huge question mark over its head when it comes to anyone guessing how it will make itself over in the near future.
That task will be on CEO Steve Ballmer's bald head -- as long as he's not dancing like a monkey. Here are a few initial pointers, Ballmer:
- Transition all your software products to the web (fee or free) and see if you can out-Google Google. Remember, the installed base for Microsoft products is huge -- lead them from their local PC to the web cloud, still resting on top of Microsoft products.
- Stop focusing on web advertising unless you're serious. Not being successful in buying Yahoo! Inc. (NASDAQ: YHOO) was a setback, yes. Still, you're not making much headway against Google. There's a reason. Find it and fix it.
- Toss out Windows Mobile and get something in front of mobile customers that's worth their time. Google's Android platform and Apple's iPhone stand to kill your market share in the mobile operating space unless you amp up Windows Mobile (maybe even call it something else). Mobile internet far outpaces computer internet, and in some ways the computer is now in the pocket instead of on the lap. Don't let an old dog like Windows Mobile be your only offering here. Reinvent robustness for the next decade instead of enhancing something so old.
Does Microsoft need a makeover? What would you suggest? Be sure to check out the other makeover posts.
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Reader Comments (Page 1 of 1)
10-23-2008 @ 9:56AM
Gloria Krawczyk said...
Microsoft's problems go way beyond mobile! Have you tried lately to get a computer WITHOUT Vista? Impossible...In the drive to lock-up the Windows market with Vista, Microsoft really blew it. (ie:check the sales of new computers lately). Windows should go back to having XP installed with updates, and only Vista if you shoose it, not the other way around.
10-23-2008 @ 1:09PM
fortesque said...
Linux, can you say, linux. Microsoft has managed to make an unbelievable pile of cash selling crap software simply because there isn't anything better available to the computing public. They REALLY need competition to force them to clean up their code and their attitude.
10-23-2008 @ 1:11PM
Stephen Geoffroy said...
In my opinion the problem is Steve Balmer. Ever since Bill Gates left the reigns to Balmer, nothing really innovative has come out of Mr. Softy and everything that has come out was either seriously delayed or broken on delivery: X-box. This man is not executing and should be executed from his posistion!
10-23-2008 @ 1:54PM
Rhonda Antell said...
Windows Vista has been a disappointment and you can't avoid it on new computers. That is frustrating and maddening as a consumer. What happened to free trade and choice? Let us at least have the choice of Windows XP.
10-23-2008 @ 2:21PM
Carine said...
My main disappointment with Microsoft is that there not looking out for the low income single family that are not able to afford their software. Also since Windows Vista came along, it is not compatible with a lot of companies' programs.
10-25-2008 @ 3:11AM
Marius said...
This was poorly written.
Theres so much better examples out there for why Microsoft is stalling against a wall right now. But it seems the writer of this article has no passion, and must have been told to write this against his free will.
10-31-2008 @ 11:46AM
Chuck Lund said...
They should have released it as "Windows XP upgrade Vista 1" and let it be. I tried the new Vista, but removed it and re-installed my XP pro software. I was able to extract a few small programs from the Vista product that I liked, and they worked Great! But.. It's still Windows XP, only with a Vista upgrade.
11-24-2008 @ 8:25AM
jean said...
Definitely go back to XP, Vista is terrible. I've never had a computer lock up and shut down so much in my life. And try playing games on it. Most game software is not compatible with Vista. I have been a PC user for 20+ years and bought a new laptop about 6 months ago, at first it was great (or at least that is what I thought), but about a month ago I bought a Mac for work, and I'm here to tell you, the commercials for Mac are right on. Once you use a Mac you'll never want to use a PC again. The PC laptop that I purchased 6 months ago will be my last that's for sure.