Is Microsoft following the right strategy?

Is Microsoft's software-as-services strategy the right strategy to pursue?

Microsoft still owns the desktop space, but they are convinced Google is heading in the right direction where the Google is establishing itself as the ubiquitous interface to software applications. So, their response is to pursue that approach - and ensure that Microsoft is the destination of choice for consumers for online applications.

Clearly Microsoft has the cache and expertise to execute the product side. But, is this the right consumer play?

I don't know, but it occurs to me that they are missing the point of Google's rise. Google got to where they are because they did something different. Not that being different is a guarantor of success, but taking on Goliath is sure suicide. Just as Microsoft set a standard, and associated their brand with it, Google has done the same.

It's an interesting paradox. Bill Gates's vision was "a PC in every home." For all intents and purposes, that's been realized. Perhaps that's why the reins have been passed from Bill to Ray Ozzie - Bill doesn't have a vision beyond his original, and as such Microsoft has struggled with the paradigm shift of the Internet. Now's it's Ray's turn to embark on a new vision. I would hope Microsoft could do something more ambitious than follow Google.

I think Microsoft would be better served looking into its crystal ball and figure out what's "beyond Google." No doubt they are doing that at the R&D level, but perhaps their corporate strategy should follow suit. After all, that's the approach that got them to their perch that they've owned for the last 15 years.

1 comment:

Brian Erst said...

I would argue that Google didn't do all that much that was different (search, adwords and analytics had all already been done before), but that they did a few things extremely well.

Microsoft suffers from feature bloat at a corporate DNA level. They rarely do anything really well (maintaining a monopoly being the prime exception), and the reason for that is that they don't limit their scope of work until it's too late.

Kitchen-sink-itis infects that company like no other. Microsoft would be heartily improved if they split their OS division in two - one that worked on a next-gen OS that was nothing like Windows architecturally but offered an emulation mode, and one that polished the current turd to a nova-like glow. Forget about trying to shoehorn an entirely new filesystem (WinFS) into Windows - that's next-gen stuff and should never have been on the table. Spruce up the GUI (Aero), give the entire existing codebase the mother of all security audits and update a couple of your bundled apps (IE7). Tell yourself that you will release a new version of the turd in September of every year and if any piece isn't at gold-master level by April, it gets punted into next year (or a service patch).

Microsoft will never do it, but look how quickly Ubuntu has taken over the Linux space by doing something similar and how well-received Apple's OS X upgrades have been.