The Problem with Microsoft

April 6th, 2011

Want an example of what I meant by “no strategy, no future”?

Here’s what Microsoft did to Courier, a promising (and original) tablet concept they were working on:

So when Robbie Bach, who led the company’s entertainment and devices division at the time, presented his idea to CEO Steve Ballmer and Microsoft’s senior leadership, he expected enthusiasm and additional funding for the project. There was just one problem: The Courier prototype borrowed from Windows, Microsoft’s vaunted computer operating systems, but had an operating system all its own. (That’s what Apple did with its iPhone and iPad — it built a new operating platform based on its existing Mac OS X.)

Bach learned a hard lesson about the power and might of Windows within Microsoft. Not only would Bach not receive the extra funding he sought, said Ballmer, who personally delivered the blow, but there would be no Courier because it was unnecessary. The best of Courier, where appropriate, would be folded into the next version of Windows, Windows 8, due at the end of 2011 or in 2012 — or maybe even Windows 9. Several months after its death, Bach announced his retirement.

The problem is very simple: they are so beholden to Windows that anything that might threaten it—whether it comes from outside the company or inside—has to be eliminated. Effectively, Microsoft is protecting Windows at the expense of the company’s long-term success. That’s not only a mistake. It’s absolute idiocy.

Microsoft has the potential to be successful in the mobile market; Windows Phone 71 is well designed and original. They have the talent. Their issue is management. Microsoft’s management refuses to threaten the company’s current business to be an important player in the mobile market. In other words, they would rather be irrelevant in the future than possibly—oh, no!—give up Windows.

Their tablet strategy is a perfect example of this. Microsoft thinks tablets should use the same operating system as PCs, with a user interface “optimized” for touch. Tablets, then, aren’t completely new devices, distinct from PCs, which would require a new use paradigm and thus a completely different user interface; instead, they are just a different form factor for using the same PC operating system we’ve been using, with the same basic use concept and user interface, just with a nice touch layer overlaid.

Why would Microsoft want tablets to be merely derivative of PCs? That’s easy: because it means what they’re currently doing, licensing a PC operating system and selling software for PCs can continue unchanged.

Microsoft’s management isn’t thinking about where computing is moving, how they can improve people’s lives and how they can capitalize on it. They’re thinking about how they can preserve their current business. And that’s a fantastic path toward irrelevancy.

  1. Their phone operating system’s name is symptomatic of their inherent problem: they put “Windows” in the name of a mobile operating system that doesn’t even have windows. They are so dependent on Windows they are afraid even to name their mobile operating system something different. []