Today Microsoft released a couple of major announcements regarding the restructuring of their entire business. The complete One Microsoft email from Steve Ballmer along with an internal memo entitled Transforming Our Company are available online at Microsoft’s news center, but what does it all really mean? That’s actually a bit difficult to say; clearly times are changing and Microsoft needs to adapt to the new environment, and if we remove all of the buzzwords and business talk, that’s basically what the memo and email are about. Microsoft calls their new strategy the “devices and services chapter” of their business, which gives a clear indication of where they’re heading.

We’ve seen some of this already over the past year or so, in particular the Microsoft Surface and Surface Pro devices are a departure from the way Microsoft has done things in the past – though of course we had other hardware releases like the Xbox, Xbox 360, Zune, etc. We’ve discussed this in some of our reviews as well, where the traditional PC markets are losing ground to smartphones, tablets, and other devices. When companies like Apple and Google are regularly updating their operating systems, in particular iOS and Android, the old model of rolling out a new Windows operating system every several years is no longer sufficient. Depending on other companies for the hardware that properly showcases your platform can also be problematic when one of the most successful companies of the last few years (Apple Computer) controls everything from the top to bottom on their devices.

There’s also the factor of cost; when companies are getting Android OS for free, minus the groundwork required to get it running on your platform, charging $50 or $100 for Windows can be a barrier to adoption. When Microsoft talks about a shift towards devices and services, they are looking for new ways to monetize their business structure. The subscription model for Office 365 is one example of this; rather than owning a copy of office that you can use on one system, you instead pay $100 for the right to use Office 365 on up to five systems for an entire year. This sort of model has worked well for the antivirus companies not to mention subscription gaming services like World of WarCraft, EverQuest, etc., so why not try it for Office? I have to wonder if household subscriptions to Windows are next on the auction block.

One of the other topics that Microsoft gets into with their memo is the need for a consistent user experience across all of the devices people use on a daily basis. Right now, it’s not uncommon for people to have a smartphone, tablet, laptop and/or desktop, a TV set-top box, and maybe even a gaming console or two – and depending on how you are set up, each of those might have a different OS and a different user interface. Some people might not mind switching between the various user interfaces, but this is definitely something that I’ve heard Apple users mention as a benefit: getting a consistent experience across your whole electronic ecosystem. Apple doesn’t get it right in every case either, but I know people that have MacBook laptops, iPads/iPods and iPhones, Apple TV, iTunes, and an AirPort Extreme router, and they are willing to pay more for what they perceive as a better and easier overall experience.

Windows 8 was a step towards that same sort of ecosystem, trying to unify the experience on desktops, laptops, smartphones, tablets, and the Xbox One; some might call it a misstep, but regardless Microsoft is making the effort. “We will strive for a single experience for everything in a person’s life that matters. One experience, one company, one set of learnings, one set of apps, and one personal library of entertainment, photos and information everywhere. One store for everything.” It’s an ambitious goal, and that sort of approach definitely won’t appeal to everyone [thoughts of Big Brother…]; exactly how well Microsoft does in realizing this goal is going to determine how successful this initiative ends up being.

One of the other thoughts I’ve heard increasingly over the past year or two is that while competition is in theory good for the consumer, too much competition can simply result in confusion. The Android smartphone and tablet offerings are good example of this; which version of Android are you running, and which SoC powers your device? There are huge droves of people that couldn't care less about the answer to either question; they just want everything to work properly. I’ve heard some people jokingly (or perhaps not so jokingly) suggest that we would benefit if more than one of the current SoC companies simply “disappeared” – and we could say the same about some of the GPU and CPU vendors that make the cores that go into these SoCs. Again, Microsoft is in a position to help alleviate some of this confusion with their software and devices; whether they can manage to do this better than some of the others that have tried remains to be seen.

However you want to look at things, this is a pretty major attempt at changing the way Microsoft functions. Can actually pull this all off, or is it just so many words? Thankfully, most of us have the easy job of sitting on the sidelines and taking a “wait and see” approach. Steve Ballmer notes, “We have resolved many details of this org, but we still will have more work to do. Undoubtedly, as we involve more people there will be new issues and changes to our current thinking as well. Completing this process will take through the end of the calendar year as we figure things out and as we keep existing teams focused on current deliverables like Windows 8.1, Xbox One, Windows Phone, etc.”

Whatever happens to Microsoft over the coming year or two, these are exciting times for technology enthusiasts. Microsoft has been with us for 37 years now, and clearly they intend to stick around for the next 37 as well. Enjoy the ride!

Source: Microsoft News

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  • bji - Friday, July 12, 2013 - link

    "use the best tablet ever with data/services/software that is regularly updated by MS for free, just keep paying subscription fee every month."

    How can you write a sentence with such an obvious logical contradiction?

    Also, subscription schemes have existed for a very long time, it's not like it's some new idea that is just waiting to catch on. And it's harder to convince people to start paying a subscription fee for something that they are used to having for free than it is to introduce a new product type with a subscription fee model from the beginning. People were used to paying monthly phone bills before cell phones were invented so nobody batted an eye when cell phones came around and the service plans required a monthly fee. Believe it or not in the good old days people didn't even own their landline phones, they were rented from Bell.

    On the other hand, nobody has ever had to pay a subscription fee just to use their personal computer, and that's what a subscription fee on the operating system would introduce.
  • Notmyusualid - Monday, July 15, 2013 - link

    Quote: "On the other hand, nobody has ever had to pay a subscription fee just to use their personal computer, and that's what a subscription fee on the operating system would introduce."

    ^^ My point exactly.
  • lmcd - Monday, July 22, 2013 - link

    The subscription cost exists whether Microsoft introduces upgrades within the period or not. The upgrade is therefore free relative to the baseline cost.
  • Notmyusualid - Monday, July 15, 2013 - link

    Agree, absolutely.
  • Taurus229 - Thursday, July 11, 2013 - link

    If we continue to go in this direction, and not just computerwise, but all industries in our country, computers will only have a place for the upper class. The middle and lower class will not be able to afford all the add on fees and rising costs. Business is getting too greedy, and our country is already feeling the brunt of it coming out of the worst recession since 1929. The people just won't take much more. Where will this leave Microsoft ???????????????????????
  • todlerix - Friday, July 12, 2013 - link

    There are a lot of solutions for different problems. If money is as alarming as you are portraying go with a no cost solution.
  • Notmyusualid - Monday, July 15, 2013 - link

    Can I pay for access to my hardware too?

    Well, it does have firmware, that requires updating from time to time...

    I must live in a South African township or something, as I know l o a d s of people not paying for antivirus, and I simply couldn't see them paying to use the base OS, that shipped with a machine they paid for.

    I've never thought I'd say this, but Linux has a future, and it is bright.
  • Metaluna - Tuesday, July 16, 2013 - link

    It's already going in that direction, but the revolution is from below. The average joe wants tablets so they can do Facebook and a few social games and not much more than that. This is killing off the low and midrange PC market, and the accompanying software markets, faster than any corporate conspiracy (and it's not MS leading that best they are playing catch up -- badly). Hopefully it won't regress back to the 80's and before, when if you needed to do "real work" you (or more likely your employer) had to drop $10K or more on a "workstation".
  • bountygiver - Friday, July 12, 2013 - link

    subscription for OS will never work, because it is something required for all other things, unless you are renting the hardware.
  • Dustin Sklavos - Friday, July 12, 2013 - link

    None of this gets rid of Microsoft's biggest problem: Steve Ballmer.

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