Here's why Microsoft has got its mojo back

Ever since the release of Vista, Microsoft has been on the defensive on every front, from operating systems to the Internet, and even to Office. No longer. Given the solid betas of Windows 7 and Office, and the release of Bing, it looks as if Microsoft finally has its mojo back. Here's why.

First, let's look at all the good news Microsoft has had within the last several months. The Windows 7 beta is not only apparently ahead of schedule, but has been very well received. And, as I've recently written, pre-sales are through the roof. As I write this, it is still number 4 on the Amazon best-seller list, even though it's months away from release.

The just-released beta of Office 2010 is a solid piece of work, but more important is that Office will finally be available as a Web-based application. This will likely be enough to fend off Google Apps, because there is no client version of Google Apps, and Google has yet to show Google Apps will be widely accepted in the workplace.

With Bing, Microsoft for the first time has a Web-based search that can rival Google's. There's not a chance it will every overtake Google, but it's already gaining market share, and maybe that's all Microsoft expects from it.

Finally, with the Laptop Hunters ads, Microsoft has put Apple on the defensive, so much so that Apple lawyers called Microsoft to pressure the company into pulling the ads. Microsoft, as you may imagine, declined --- and then exulted.

So what's happened to Microsoft? Why is it that the company floundered for so long, and only now is hitting its stride again?

The primary reason, I believe, is cultural. Microsoft was always at its best when it felt it was an underdog, even if in fact it was an alpha dog. In earlier days of the company, Bill Gates was excellent at creating that underdog culture, but in his later years, one had the sense that his attention had wandered. And once he left, the company culture was adrift.

So why has the company culture changed? Because for the first time in a very, very long time, Microsoft has in fact been an underdog. Google has been on top of Internet search and services, Apple got all the buzz for its new products, and Vista was widely reviled.

I think Microsoft finally recognized that it couldn't just sit on a pot of cash and giant market share. If it didn't start releasing solid products and rethink its Internet strategy, Google over time could even own the desktop.

In short, the company got its hunger back. And the results are starting to show.

That's not to say that the company is perfect --- far from it. It needs to more aggressively Web-enable its applications, it needs to slim down Windows and possibly release it as a series of constantly upgraded mix-and-match components, and it needs to develop breakthrough products in the way that Apple has done.

It's hard to know whether that's possible. But for now, at least, Microsoft has got its mojo back.

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