One could argue with much justification that Microsoft has benefited far more from Windows and Office than have the company’s hundreds of millions of users. I hesitate to call them customers because Windows and Office are not de facto standards in business as much by choice as by hook and crook.
As an illegal monopoly Microsoft forced itself and its cash cow products onto the corporate world which needed a single standard for files and apps, and ended up not having much choice in the transaction. Well, as they say, ‘what goes around comes around.’ Or, put another way, ‘Karma is a bitch.’ Microsoft completely missed the mobile device revolution instigated by Apple’s iPhone and tablet model, and suffers greatly– not in profits as much as potential.
File formats and data these days are mobile and not tied to a particular platform; platform agnostic, if you will. To be fair, traditional PCs will be around for awhile, churning out tasks that mobile devices cannot– for awhile. Even Microsoft recognizes that the power of the PC is moving to the cloud, everyone else is moving to the cloud, and as the de facto technology industry leader, Microsoft must follow.
By following or leading, Microsoft is making mobile versions of the company’s most popular applications free. It’s like getting free Office for iPhone and iPad. Free. Make no mistake about it. This is a huge gamble for Microsoft which hopes– and it’s just a hope– that free Office apps for mobile devices will keep customers around for when the company figures out how to make money with cloud services. Microsoft has cloud services. It has apps that connect to the cloud. It has customers. What’s unproven is whether that will translate into revenue and enough of it to find profit.
If not, Microsoft is screwed, and the funny thing about this situation, whereby Microsoft missed the mobile device revolution, is this. Microsoft could be screwing itself into oblivion by doing to itself what it did to customers for the past few decades.
Think about the changes in the industry since the iPhone launched. Data is cloud-based, platform agnostic, and no longer only PC based. Apps to access and use that data are simple, elegant, and highly mobile. Microsoft missed that revolution entirely and in the smartphone and tablet industry segments, has negligible marketshare. Worse, notebooks running Windows are down to $199, leaving manufacturers to fight over declining profits, and even Microsoft has been forced to cut prices of Windows and Office to keep pace with the race to zero margins.
In simpler terms, Microsoft is getting screwed by market conditions, some of which are the company’s own fault, and its response to diversify has been one failed effort after another, the loss of billions in failed acquisitions, and now, somehow, it’s going to right the sinking ship by giving away a product for free that once helped to make it filthy rich.
My, my oh my dear karma, what hath Microsoft wrought upon itself?