Microsoft CEO Candidate Elop Said to Mull Windows Shift
bloomberg.com
bloomberg.com
Short term, quarterly numbers-focused business people. Lying off 50% of their employees will also improve their numbers by 2015.
Apple and Google have become the largest tech companies thanks to their consumer facing products. Selling Xbox and Bing will only seal MS's faith as another IBM. Windows Phone and Surface will stagnate (even more) and eventually they will have to be let go too.
Non-tech people often ask me if IBM still exists when it is mentioned in a conversation. They'll be asking the same thing about Microsoft in a decade or two if Elop takes over.
It's not necessarily a bad fate for the stockholders, even if it's way more cool to be Apple than to be Oracle.
Microsoft's ratio of popular to unpopular consumer products has been dismal for years; it's hardly unreasonable to think they might likewise do better by refocusing.
Giving up the consumer market to focus on business puts this dominance in danger (even more so than the mobile/tablet threat), because someone might very well and up doing to Microsoft what Microsoft did to the minicomputer makers, and eat their business "from the bottom up".
So I think the interesting question is whether Microsoft could survive and thrive on enterprise software/services in an environment where neither Windows nor Office were dominant.
These types of comments sealing the fate of MS comes up at any post relating to Microsoft. However its far from the truth, Microsoft isn't going anywhere as much as Adobe, whether someone likes it or not. Xbox is one of the major revenue earning division for MS (not from console but from games, digital rights and live) and it is going thrive despite their PR clusterf*ck with Xbox One. Windows Phone and Surface slowing gaining momentum and WP is starting to see large market shares outside of U.S.
This isn't even remotely accurate. Xbox barely draws a profit in comparison to it's office, windows, and services groups.
In the business space they need to counter the cloud and APIization of the market. They need to make it simpler, integrated and more effective on Windows devices. And they need to target small businesses. The need to cloudize workgroups/domains and make it simpler.
The rest of the cloud market being built on linux/open source and relies on web browser standards to achieve cross platform penetration. But in the current reality, Windows PCs and iPads are all that matter.
"We appreciate Bloomberg’s foray into fiction and look forward to future episodes"
http://www.theverge.com/2013/10/23/4975448/microsoft-frank-s...
http://www.businessinsider.com/microsofts-david-pogue-tweet-...
http://pulse2.com/2012/07/28/frank-x-shaw-responds-to-micros...
Given that Bloomberg seems to cite three sources who vouched for Elop's thinking on this, I think this could be a tactical move from Elop (because it would be relatively harder for his opponents to get three senior Microsoft sources to smear him).
Elop is shadow signaling his thinking to various Microsoft stakeholders. "I am not status quo. I will reconsider all old notions. I know Microsoft needs radical change. The era of Windows is over."
It could also be a reminder to shareholders of what happened to Nokia. Elop's vision of "burning the village in order to save it" sounds pretty apocalyptic.
http://www.businessinsider.com/microsoft-earns-2-billion-per...
From a business standpoint, the XBox is one of the worst performers in the entire Microsoft company.
Dude, its a known fact that the XBox division is a dog from an investment perspective.
Nope.
The only reason XBox360 made any money was because of XBox Live subscriptions and Ad Revenue. Neither selling consoles, nor games have made any money for Microsoft.
The XBox One tried to refocus itself as a more profit-oriented machine. Why is it "always online" ??? Because XBox Live subscriptions and Ad-revenue were the #1 source of revenue for XBox.
Why is the XBox One weaker than the PS4?? Because XBox never made money off of games. In fact, Microsoft lost money as far as games themselves are concerned.
Microsoft made a decision: they decided to attempt to make the next generation XBox One profitable at all. Those decisions have cost the XBox One its reputation... but were probably necessary so that the XBox division actually could make money.
When you have a part of your company that is continuously bleeding money, with an inability to actually monetize your brand... you need to spin it off. Its basic business strategy. The other possibility is if they could find a way for XBox One to make money while still keeping a positive brand image.
At the end of the day, Microsoft needs to make money, but the XBox isn't doing that for them.
MS have a problem in that they don't really have a successful consumer products division. One way around that is to stop worrying about it, which seems to be an increasingly popular point of view.
Anyone that wears a suit and tie to work is going to just steer Microsoft further and further into the ground. Elop needs a hoodie.
What kind of experience and character traits do you think the next Microsoft CEO should have? I'm having trouble deducing those from age/clothing.
J Allard, Ray Ozzie, and the like have the potential to do great things, but honestly CEO of Microsoft is maybe not what they would do best at or enjoy.
Microsoft needs a systems thinker, someone who gets the business side and the tech side, while having the ability to shepherd great products on the consumer side and service the business needs of their huge enterprise customers. That is a ridiculously tall order and I'm not sure that anyone would do an outstanding job with it.
I don't know why Scott Guthrie isn't on the list.
Microsoft only looks like a bad company when you compare it to the (very!) short list of tech companies that have been better than it for the last 10 years.
It's certainly true that I can get the windows-on-a-desktop paradigm from Windows (pre-8), OS X, or GNOME or KDE from five years ago. I could probably get the Metro user experience from an especially clever KDE Plasma plugin too.
However, despite free software versions being widely available, we've only seen two windows-on-a-desktop operating systems in wide use, and one of them (OS X) has a very limited install base. This means that the free versions are not equivalent to Windows, as much as I'd like them to be.
I see two reasons for that:
1) Getting the details right is really, really hard. This is especially true when there are a large number of computer users who are used to Windows - I don't think it's impossible to make another OS that they would use, but it would take a huge amount of usability engineering. (This is basically what Ubuntu is trying to do; but that's a side note here.)
2) Application compatibility is really, really important. In other words, even if GUIs are a commodity, the APIs underneath them aren't. This is something that is currently being attacked on two fronts - the Web is providing an alternative, standard API across desktop platforms, and non-Windows mobile devices are forcing developers to use non-Windows APIs. That makes Windows just another incompatible system to weigh the costs and benefits of developing for, rather than the standard which every program must support.
Elop isn't just looking at the explosion of tablets and smartphones, markets where Microsoft doesn't have much marketshare. He's also looking at the fact that the Chromebook has been the best-selling laptop on Amazon for at least a year, if not more. That shows that (2) is no longer enough of an advantage to keep Windows on consumer computing devices. It probably is enough to keep it on business workstations for a while longer, but he's smart enough to know that won't last forever - business IT is becoming increasingly consumerized. (1) is still an advantage, but the Chromebook and tablets both show that people will use a simplified, well-designed interface that's not Windows - hence the move to Metro with Windows 8.
Given all this, what is Microsoft going to do? The operating system cat is out of the bag, and it's probably not going back in. People are going to increasingly expect to bring their own devices into work, and some of those devices are not going to be running Windows. If platforms that don't run Office gain significant marketshare in the business world, then businesses will have to start considering alternatives, and maybe even start using formats that aren't doc and xls.
Thus, Microsoft's next move is clear. It offers Office on all popular platforms, allowing businesses to continue to not think about alternative office software. Apple makes its money from devices, and probably won't even fight if Microsoft does this. Google won't be happy because of Google Docs, but Microsoft has enough legacy support and can offer good enough enterprise management features that they'll still do well in this market.
In the meantime, Microsoft continues working full-tilt on Windows - just because it's no longer dominant doesn't mean that they can't make significant amounts of money from it. My thought would have been to bring the Metro interface to Xbox, although apparently Elop is thinking differently. It might even be true that the Office programs continue to work best on Windows. But whatever happens in the OS market, there's no reason Microsoft can't extend its office software dominance for a while longer.
What? He was purposefully planted there by Microsoft for that exact purpose- kill symbian so microsoft can buy nokia for a steal.
Microsoft squandered their lead in smartphones, you can blame them and Ballmer for that, but the particular video people love to continuously bring up has nothing to do with where MS made mistakes.
I think this video very clearly shows how Ballmer managed to not take the iPhone seriously, and that has everything to do with why Microsoft made mistakes and were slow to respond from 2007 onwards. The same thing happened with the iPad as well. From everyting he said, you could see that he regarded them as toys.
Hatchet men are useful, well paid, but definitely not high-profile, except to knock down and make their successor look better by comparison (see HP: Apotheker and Whitman).
All this talk of MS needing a forward-thinking visionary with ideas is just wrong. Just look at the environment these tech companies inhabit. You have Google, Samsung, and Apple all declaring patent war. That's how it has always been. Go back to Sun and Microsoft. Or Netscape. Or what MS did to IBM. It goes on and on. Oh, sure, on the consumer side all these companies appear to be innovating and everything is peachy. But that's marketing. In reality it's a cut-throat, winner-takes-all game they are playing.
Want Microsoft to succeed? I don't think most people on HN have the stomach for it. You like open source. Open standards. Playing fair. When Microsoft was good, they were really bad.
Sherlund is an idiot. The proposition, if you ask any consultant/financial analyst/Rick Sherlund is to maximize shareholder value. The problem with MSFT, Apple, Google is that shareholders are short sighted and don't understand how technology works or the charms of integrated offerings. They only see Product/Service/Capability-Cost mappings and see that by disposing money losing assets, they can enhance value proposition through the remaining assets.
Elop's strategy is fine if MS is in a money crunch and wants to undertake Cost Optimizations. It's not fine when MS is in the midst of their "3 screens, one cloud" transformation. If XBox and Bing continue their trend of losing money in the next 5 years, then yes, I would do things that Elop is fictionally proposing to do. Until then, hell no.
Casting off Xbox at this critical point would be a disaster and massively weaken Microsoft's position. The post-PC era is dictating very clearly that Xbox may be the last "full PC" device remaining in the modern home... and he wants to cast it off?
Bing... it's better than defaulting their products to use Google.
Microsoft Office is a fine product but it is a legacy one.
I wonder what Elop's "opinion" is of Azure? That ridiculously high productivity and highly agile team that's been pumping out releases on a 2-3 weekly cycle for the past 2 years?
Wait. What? Why is Elop even in the running at all for the CEO position? That itself is fucking insane. Look what he did to Nokia!
https://www.microsoft.com/en-us/news/press/2001/nov01/11-11c...
Getting their stuff on the Android and Linux platforms would help a lot, but then again, Linux has plenty of Open Source alternatives already.
I don't see an office on android / ios strategy as anything but a money loser in the short term. In the long term there is a risk of a competing product stepping in where they are not, but office has no cross-platform competition right now worth worrying about, and definitely nothing on mobile. I still think the windows on tablets strategy is the most likely path to long-term profit.