It’s not much of a secret that Microsoft has been going through a tough patch lately. The once thought untouchable technology company is on a slippery slope. Much of their ventures have been failing. Bing, which as much as they try to push with national campaigns, hasn’t gained much popularity. They promote it as a decision engine, whatever that even means. I will add that I’ve never actually used the site and don’t intend to because I’ve very satisfied with Google.
Every quarter Bing has been bleeding millions without much to show for it. Google still holds most of the search market share. However, Bing isn’t the only problem facing Microsoft. They’re late in the game with Surface as their iPad competitor. Their Windows phones aren’t attracting many consumers which discourages developers from creating apps for their phones.
Then yesterday came the news that Microsoft was charging off $6.2 billion from the acquisition of aQuantative which is an Internet advertising firm. They acquired aQuantative because they wanted to beef up their online advertising efforts and expected growth to accelerate which it didn’t live up to.
It’s also not a secret that the department at Microsoft making the most money is the licensing of Microsoft Office and all of their operating systems, including XP, Vista, and Windows 7 which brings in billions each year. But for how long can you sustain trying to build all of these other products and services on the back of their licensing? Is it Microsoft’s plan to just throw as much crap at the wall and see what sticks and turns a profit? It sure seems like it.
All of these things point to bad management decisions but it wasn’t only under current CEO Steve Ballmer’s watch it also happened under Bill Gates. It’s no secret that Microsoft’s corporate culture is horrible. I recently spoke with someone at a tech festival who described working for Microsoft as Social Darwinism. It’s survival of the fittest where only those who stand out of the bunch make it. You can see how that would make working in groups difficult because everyone is trying to stand out individually instead of working together.
Today Vanity Fair posted a preview to an article in their August issue titled Microsoft’s Downfall: Inside the Executive E-mails and Cannibalistic Culture That Felled a Tech Giant. As the title suggests, the author Kurt Eichenwald has dozens of interviews and internal records. He goes on to state that the last decade of Microsoft could serve as a business school case study which resonates with me because I’ve done several of these recently in school and I could see how many of their problems ultimately point to bad management.
I understand the need to diversify. I understand the need to create the Surface as tablets and PCs become more interconnected. But there’s a problem with spreading yourself too thin. Microsoft is a great software company so maybe they should focus on creating great software. I’d prefer to have a business that is great at a few things than being mediocre at a lot of things. I just wish Microsoft would’ve realized this sooner. Microsoft is launching Windows 8 soon which they have priced very competitively at $39.99 for people who already have XP, Vista, or Windows 7. I haven’t tried the beta but from what I hear it’s very light weight and could be a viable competitor for OS X.
I said in my previous post and I don’t mean to beat a dead horse but I really like when companies are competing because it makes them more innovative and in the end we all win. I’m rooting for Microsoft because for a long time I was a Windows guy. I hope they’re able to overcome all these setbacks in recent years and get back to being the leading company they once were. I can’t wait to see the final Windows 8 OS. I can’t wait to read Eichenwald’s article. Look out for it in the August issue of Vanity Fair. What are your thoughts on all their recent news? Let me know in the comments or on Twitter.