Microsoft recently made a series of announcements in its latest attempt to reinvigorate its markets. It talked about the newest version of its flagship OS, Windows 10, as well as its move into the virtual world with HoloLens and its play to wire enterprise meeting rooms with Microsoft Surface Hub. And not long ago it also announced it would make Microsoft Office available on iOS and Android mobile devices, something it was very hesitant to do in the past. Is all of this just Microsoft putting on a good show, or are these announcements meaningful expressions of its future direction?
Starting with Windows 10, the two biggest take-aways are this. Under the new management of Satya Nadella, Microsoft is finally listening to its customers again. Instead of the old regime’s “take Windows 8 even if you don’t like it because we know what you need” approach, Windows 10 has honestly taken into account the customers' complaints and tried to address them, while staying true to the need to update Windows for a touch and perceptually oriented world (e.g., using Cortana to add natural language processing which will expand beyond just voice input).
Its not yet clear whether Windows 10 will solve all the negative perception problems Microsoft garnered for itself with Windows 8, but early indications at least show its moved in the direction of trying to make traditional windows users happy with the selection of Windows 10 as their future. And the offer to give Windows 10 away for free to existing Windows 7 and 8 users is an indication they are trying to make things right (and of course get a very large installed base of Windows 10 as well, which will help them in many ways from app developers to offering support). Getting everyone on Windows 10 as soon as possible also helps Microsoft with its next goal described below.
The second big take-away from the announcement was more subtle. Microsoft talked about Windows-as-a-Service (WaaS). While not really defining it, what was clear is that Microsoft intends to alter the way Windows and its updates are deployed to users and devices. It is moving away from major service packs and upgrade downloads, to a more transparent and behind the scenes approach.
I see this as a precursor to where Microsoft would ultimately like to move – a WaaS that has users buying a continuing subscription (much like with Office 365), rather than a one time license when they buy a new machine (or buy an upgrade). This change in strategy ultimately helps Microsoft’s revenue stream, but also provides it with the advantage of being able to modify an OS under the covers without having to deal with existing base.
This WaaS model won’t take hold overnight, but I expect over the next 3-5 years WaaS will become the dominant way Microsoft sells its OS across all its platforms. In the future, Microsoft plans to be a fully committed cloud company, and WaaS, as well as the previously mentioned announcements for Office on Android and iOS along with emphasis on Office 365 are indications of how it plans to get there.
HoloLens was an attempt by Microsoft to put a stake in the ground and say we are going to be a major factor in the new world of virtual reality. No delivery plans or prices were announced for the product. But it shows that Microsoft wants to be seen as an innovation company – something many have believed Microsoft wasn’t anymore. Microsoft is now looking at the world in 3D.
I expect to see many more announcements of both technology and products emerge from the labs at Microsoft over the next 1-2 years, competing both head to head with Apple and Google, but also establishing new ground that supplements and augments its installed base of Windows, Office, Skype, etc. It will likely work closely with its traditional partners (e.g., Intel who is also devoting significant effort to innovating in the new world of perceptual computing), and acquire technology where needed. Given its installed base, this is an area where Microsoft can demonstrate leadership if it shows a commitment to innovation and not just copying for the sake of competing. This will be a major Microsoft strength going forward, and the real take-away from the HoloLens announcement.
The final area of the recent announcements was directed at the enterprise. Microsoft Surface Hub is a product that is meant to invigorate the way meetings are done. Clearly the device itself is impressive, even though the cost, given its high end hardware, will likely be high. But the important take away is that Microsoft focused on integrating a number of its often disparate products into a continuous and fluid experience.
It’s not so much about creating new things as it is about merging and massaging what it already has into a more useful form and function. That is what enterprises are looking for. Enterprises don’t need more products. They need a better way to engage with the ones they already use. That will be key to Microsoft’s (and everyone else’s) impact on enterprises going forward, and whether it can compete in this space.
So what’s the bottom line? With this set of announcements, and others in the recent past, Microsoft has shown that under its new management it is moving towards regaining its status as an innovator. Listening to its customers is the first step, but realigning its components and introducing new ways of interaction are what will take it into the next decade. Those that predicted Microsoft’s irrelevance in the new age of computing are mistaken. I expect the newly invigorated Microsoft to continue to impress and have a major impact on computing for the foreseeable future.
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