Microsoft’s (Current) Strategy
Anyone who has ever used a desktop computer has more than a passing knowledge of who Microsoft Corporation. They have been the dominant operating system for business and personal computer users for more than three decades. The company also has dominated the office suite market with its Microsoft Office array of word processing, spreadsheet, and presentation software. Is there any way an administrative minded person can hope to get a job without having knowledge and experience with at least one product offering in Office 365?
That was then, this is now. While the company still has a stronghold on its tried-and-tested office and desktop products, the company has recently changed its strategy and moved in a more mobile direction – focusing on mobile computing. One of its latest moves to establish an entry point is to offer its Office Suite as a free download to owners of tablets and smartphones. Depending on its historic foothold in the office applications market, it expanded the offering to run on Android as well as Windows mobile operating systems.
In order to make this major shift in strategy to mobile devices, it announced a layoff of 13,000 employees and all but killed off its Nokia line of Android smartphones. These are drastic moves, but necessary to send a message to its company and competitors that the time for mobile is now. With the announcement of the layoffs came a business strategy focused on Microsoft’s current product offerings.
Office 365 is the result of evolving from a one time, keep-it-forever pricing plan to an annual subscription. This is the result of simplifying customer support for the widely popular office suite application. Like many of its former operating systems, consumers screamed when support of their legacy products ended. The implication was that a company as large as Microsoft should stand by its $99 Office Suite forever – free of charge. Microsoft thought otherwise, and moved in the direction of an annual pricing scheme.
This change is significant as now both the desktop and mobile platforms can be supported under a single umbrella without having to deal with a variety of operating systems and hardware changes.
While mentioning the fact that you have a Windows Phone does not have the same impact or prestige as mentioning an iPhone, the reviews of the phone are fairly solid. A Windows operating system on a smartphone sounds like a logical and convenient idea, but people have not yet bought into the relationship. Part of the reason is that, once again, Microsoft ignored its necessity to or delayed its entry into the market. With its abandonment of the Nokia line, Microsoft now moves towards competing in the lower priced smartphone market, which has a wide global appeal, and plans to market its future lines of smartphone products with the Windows mobile operating system.
While there are alternatives to Skype, Microsoft once again looks to rely on its established reputation for quality desktop applications, using it as a foundation to expand the phone application into the mobile market. Several recent upgrades have made the application more user friendly, and the cost of using the app is remarkable low when considering the limitations that some telecommunication providers place on services such as international calls. The company’s strength in this area is the video capability incorporated into the app, allowing it to be video mobile and global for businesses with international offices requiring multinational cooperation to resolve product and service issues. Barriers in language will always exist, but a picture is worth 1,000 words.
OneDrive cloud storage
Though cloud computing and cloud storage are buzzwords, and very cool sounding, the need for cloud storage services will skyrocket over the next five years. When you think of cloud storage services, think of … Amazon?? That is correct. When it comes to business storage, Amazon is just as dominant as Microsoft is to desktop operating systems and Google is to search engines.
Microsoft, Google, and now Yahoo, are three major players to get a piece of the expected growth of cloud computing over the next five years. Microsoft has stepped up its advertising and promotion of its OneDrive service to businesses and consumers, which includes offering a one year subscription to its Office 365 suite of products for free when purchasing OneDrive space.
The Bing search engine
Honestly, Google and search engine are one and the same in the minds of 80 percent of the world’s Internet users. So why would Microsoft declare it Bing search engine to be part of its strategy? The simplest answer is that it does not intend to compete with Google in the usual sense of the word, but to make sure Microsoft loyalists and Google traitors have a viable alternative from a reputable, established company.
The biggest question is whether Microsoft will be able to gain a significant enough of a foothold to start making traction against mobile stalwarts like Google and Apple. To those under the age of 25, who are the trendsetters when it comes to the purchase of new mobile technology, Microsoft is more like last week’s news than a technology powerhouse. In one sense they are correct, as the company lags far behind the world of mobile computing.
But make no mistake. While desktops sales are declining, there is still a boatload of revenue coming in from its traditional software licensing agreement to fuel the mobile charge. In fact, in the spirit of its strategy change, it has modified its licensing agreements to allow a single license to be used for desktop and mobile devices instead of requiring a license for each individual device. If that sounds more like antiquated pricing policies and profiteering, you are not alone in that thinking.
Microsoft is making substantial and measured moves in starting up its competitive engine as its moves into the mobile market. It is doubtful Apple and Google are concerned much at this point. A year from now we will see whether Microsoft generates enough attention and revenue to be serious considered among the mobile heavyweights.