As the tech news is saturated with the release dates of iPhone and iPads, developments in the Apple vs Samsung trial, and Facebook Inc (NASDAQ:FB) doomed outlook– one kind of misses out on Apple Inc. (NASDAQ:AAPL) historical rival and the leader of the erstwhile IT boom, Microsoft Corporation (NASDAQ:MSFT). Microsoft is under immense pressure to beat the rumblings that predict Windows 8 as a failure and Surface tablet a flop. If Windows 8, fails to deliver , it won’t be just Microsoft’s loss, but the dependents like, Dell Inc. (NASDAQ:DELL), Hewlett-Packard Company (NYSE:HPQ) and Nokia Corporation (NYSE:NOK) will also suffer. MS has a record of making bad moves and then correcting them. We all remember Zune and Windows Vista, the former was too little too late, while the latter was simply bloated.
Steve Ballmer: More Words Less Action
Microsoft’s CEO of 12 years, Steve Ballmer, has made it clear that he is leaving no avenue in technology, without pitching his own competition, be it Google Inc (NASDAQ:GOOG) or Apple Inc. (NASDAQ:AAPL), it will fight on all fronts. Steve Ballmer was quoted as saying in an interview, “we are not going to let any piece of this [go uncontested] … not the consumer cloud. Not hardware software innovation.”
While the proclamation is flashy and sensational, is it really smart? The competitive attitude is very good but all Ballmer had to say when iPhone was launched in 2007 was, “[iPhone is]the most expensive phone in the world…it doesn’t appeal to business customers because it doesn’t have a keyboard.” While the said smartphone is indeed the most expensive one, Ballmer clearly had no vision of its features. Ballmer is also known for mocking iPads, tablets, Google and Android. The issue here is that just mocking a device and then acquiring ready-made products to compete against it does not look well with Microsoft’s image.
Microsoft Corporation (NASDAQ:MSFT) shares have been on a downward trail since Ballmer’s appointment as CEO in 2000. They now trade at half their value at $30.0 and went even as low as $20 in 2002. Back in November 2011, David Einhorn, President of Greenlight Capital, an influential hedge fund, called for Steve Ballmer to step down and give the opportunity to someone else. He said, “His continued presence is the biggest overhang on Microsoft’s stock,”. Its not just the investors who have lost confidence in Ballmer’s leadership, it seems like the employees at Microsoft Corporation (NASDAQ:MSFT) are also not very excited about it.
Surface Tablets and Windows 8
There is no doubt, no matter how much Ballmer denied it in the past, that smartphones and tablets are game changers that are here to stay. Although, it is unlikely that consumers will entirely dump laptops and desktops, for many reasons. But the shift in market trend is very real and MS has to compete on this front. No matter what the Apple lovers and Googlers say, everyone is waiting for the release of Windows Surface Tablet on October 26th. The product does have some attractive and innovative features that have to be tested before a verdict is given.
The latest version of Microsoft’s flagship product, Windows, is also releasing on the same day. MS has a history of hitting and missing on its OS. It followed this pattern by making the hugely successful Windows 98, then the not-so-popular Windows Me/2000. But, the competition is tougher than ever in IT sphere in this age, maybe Microsoft has learned some lessons and we might see a hit.
Yammer Acquisition
Staying true to the CEO’s proclamation, Microsoft very recently acquired Yammer to mark its standing in social media. The acquisition shows that Microsoft did not think it was either productive or possible to create a new niche for itself in the social media, so it cultivated what was already available. Microsoft also bought Skype in late 2011, and that was an $8 billion acquisition so this looks like a small one in comparison.
If indeed Microsoft Corporation (NASDAQ:MSFT) gives its SharePoint software an attractive makeover with Yammer integration, it could put the odds in its favor. A content management and sharing platform with handy communication features does look tempting for corporate businesses. If it fails to do that, Yammer would just be another Microsoft-unworthy acquisition. While stepping into smartphones and tablets is inevitable in the present day, a giant like MS could have done without its social media venture which splits focus in so many different directions.
Microsoft has always had a solid base in the OS race for years now. Users around the globe are waiting for Windows 8 to release. While Apple’s Mac may be popular in the US, the truth is that the rest of the world is more comfortable with Windows, owing to its portability and affordability. If MS is unsuccessful with Windows 8, people will still stick to Windows 7, but if it manages to succeed, we will see a hot new competitor in the tablet and smartphone line.
