Say Goodbye To Microsoft

In the beginning, Microsoft’s business model was simple. They made the Windows operating system and licensed it to manufacturers, who then put it on their various computing machines. In the mid-nineties, Windows gained critical mass with businesses which, in turn, led to the adoption of the Windows operating system by consumers. The PC OS Wars were not just won by Microsoft, they were decisively won by Microsoft. Every other company that made competing PC operating systems was annihilated, save Apple, which only held on by the skin of their teeth.

Microsoft’s original audacious vision was a computer on every desk. (Importantly, that vision later became corrupted and transformed into “Windows” on every desk.) By the turn of the century, Microsoft had, for all intents and purposes, accomplished their mission. Now what?

A company that feels it has reached its goal will quickly stagnate and lose its vitality. ~ Ingvar Kamprad

When Money Is Your Guide, You Are Lost

Steve Ballmer has often said his goal was to make money. And he did. But making money is the means, not the ends.

Money is only a tool. It will take you wherever you wish, but it will not replace you as the driver. ~ Ayn Rand

I’m a HUGE fan of companies making money. Money is the way one keeps score. But money is not the game. And the game’s the thing.

To fulfill a dream, to be allowed to sweat over lonely labor, to be given a chance to create, is the meat and potatoes of life. The money is the gravy. ~ Bette Davis

A business that makes nothing but money is a poor kind of business. ~ Henry Ford

There are people around here who start companies just to make money, but the great companies, well, that’s not what they’re about. ~ Steve Jobs

Money is a great incentive, but when it becomes your main incentive, it attracts the wrong kind of people.

You cannot motivate the best people with money. Money is just a way to keep score. The best people in any field are motivated by passion. ~ Eric S. Raymond

If a company values profits more than its vision, it will first lose its vision and then, ironically, it will lose its profits too. Money is an excellent servant but it is a terrible master.

Microsoft’s Lost Decade

Microsoft desperately tried to get into phones, tablets, watches and TVs but they missed and they missed badly. This is where their subtle shift from “a computer running a Microsoft operating system on every desk” to “a computer running Windows on every desk” came back to haunt them.

Where it is a duty to worship the sun it is pretty sure to be a crime to examine the laws of heat. ~ John Viscount Morley

At Microsoft, Windows was the Sun and anyone who espoused anything else was a heretic that had to be hunted down and eliminated.

Rather than try to create an operating system right for the various emerging form factors, Microsoft insisted — over and over and over again — on trying to shoehorn Windows onto every form factor. The results were disastrous.

The Mobile Wars Were Over Before Microsoft Even Entered The Fray

iOS and Android won the mobile OS wars as decisively as Microsoft had won the PC OS wars.

First, iOS and Android got out to a huge lead long before Microsoft was able to respond with Windows Phone 7 (then 8) and Windows RT and Windows 8.

Second, Google undercut Microsoft’s licensing model by giving their Android OS away for free.

MicroChartMicrosoft – like World War II Japanese soldiers stranded on deserted islands – continued to pretend the war was ongoing while everyone else went about the business of post-war reconstruction. Not only had Microsoft lost the post-PC wars, but their insistence the world was still fighting the PC wars jeopardized their possibilities in the post-post-PC world, as well.

Microsoft’s Anti-Strategy

Strategy is about choices, about making the hard decisions and about focus. Microsoft’s response to iOS and Android might be described as an anti-strategy. They chose not to choose, they decided not to decide, they focused on everything (which is to say that they focused on nothing).

  1. Microsoft wanted to be Google so they created Bing
  2. Microsoft wanted to be Microsoft so they licensed their OS software
  3. Microsoft wanted to be a monopoly so they ported their desktop OS to tablets
  4. Microsoft wanted to be iOS so they created Windows Phone 7, then 8
  5. Microsoft wanted to be in tablets so the created Windows RT
  6. Microsoft wanted to be the iPad so they created the Surface
  7. Microsoft wanted to be Apple so they restructured their company along functional lines
  8. Microsoft wanted to be the iPhone so they bought Nokia

Be yourself. The world worships the original. ~ Ingrid Bergman

The secret of change is to focus all of your energy, not on fighting the old, but on building the new.

The key to success is to focus our conscious mind on things we desire, not things we fear. ~ Brian Tracy

We believe in saying no to thousands of projects so that we can really focus on the few that are truly important and meaningful to us. ~ Tim Cook, Acting Apple CEO, January 2009 FQ1 2009 Earnings Call

Microsoft didn’t play to their strengths. Instead, they entered every game and tried to compete everywhere.

If you don’t have a competitive advantage, don’t compete. ~ Jack Welch

Microsoft didn’t want to narrow its options. Instead, they wanted to be everything to everybody. They didn’t want to be anything in particular so they produced nothing anybody particularly wanted.


CAPTION: The very epitome of a Microsoft product — chicken-flavored vegetable ham.


Honest criticism is hard to take, particularly from a relative, a friend, an acquaintance, or a stranger. ~ Franklin P. Jones

The recipe that made Microsoft dominant is not the recipe that will make them relevant again. Say goodbye to Microsoft…


…the new Microsoft has arrived.

Next week, I’ll look at Microsoft’s new strategy and analyze its potential and its potential pitfalls. (SPOILER ALERT: So far, I like what I’m seeing.)

Do not go where the path may lead, go instead where there is no path and leave a trail. ~ Ralph Waldo Emerson

Published by

John Kirk

John R. Kirk is a recovering attorney. He has also worked as a financial advisor and a business coach. His love affair with computing started with his purchase of the original Mac in 1985. His primary interest is the field of personal computing (which includes phones, tablets, notebooks and desktops) and his primary focus is on long-term business strategies: What makes a company unique; How do those unique qualities aid or inhibit the success of the company; and why don’t (or can’t) other companies adopt the successful attributes of their competitors?

982 thoughts on “Say Goodbye To Microsoft”

  1. “Microsoft didn’t play to their strengths. Instead, they entered every game and tried to compete everywhere.”
    I absolutely love that statement. Very true, and contemptible. They single handedly killed so many companies by sheer will and market position.

    1. What is fascinating about your last point, is that they can no longer do that in todays market no matter how bad they want to. I remember during the Netscape era when every executive I knew, outside of MSFT, kept saying it was only a matter of time and it was true. It seemed that was the rule of thumb. If Microsoft entered the market everyone else was hosed.

      Part of this has to do with the size and scale of the new industry, AKA someone doesn’t have to lose for the other to win, but we can’t help but conclude we will not see a company as dominant as MSFT was in a space for quite some time, if ever again.

      1. During the monopoly days, there was a hugely dominant ecosystem, Windows. There were Macs, of course, and Linux, but they were very much on the periphery.

        Sorry for bringing out this old saw, but when viewed from the inside of the iOS ecosystem, we are seeing that dominance, and worse, right now. The saving grace for iOS is just that it’s not viewed as a monopolistic situation. Not being a monopoly makes it legal, but it does not make it more palatable.

        1. I see what you are saying about the view from inside the iOS ecosystem. It’s both open and closed at the same time both to a degree. But a pure monopoly argument can’t fly with an ecosystem of about 600m vs an ecosystem of now over a billion of Android.

          This point, is where the scale comes into play. There are parts of this very large market who don’t value the simplicity and enhanced experience holistically a somewhat walled garden approach delivers. There is nothing wrong with this. That is why the market is large enough to support multiple ecosystems. Hence why there are two, and could be more in the future.

        2. Frankly I didn’t know the iOS ecosystem is now a monopoly.

          I thought the meme now is Apple is doomed.

  2. Microsoft has more than enough resources to come up with a product that no one has made before. If they want to copy Apple or Google, they must not copy their products, but their methods. Apple came up with the iTunes ecosystem along with the iPod, then the iPhone and then the iPad. It was done with clear goal that transpired in stages. Google came up with the world’s best search engine and from there built everything around it where their core business model was embedded into everything they entered into. Android was given for free. And Google makes money through ads. The same with YouTube. There are territorie where Google entered a little late and it did not work – social media like Facebook is an example. But Google has not turned arrogant or become obsessed with its core business model. They are trying various other things – Driverless cars, robots, maps and so on.

    Microsoft became the IBM of the modern era where everything became conservative and traditional. Innovation or creativity was discouraged. Money making by bullying and market dominance with mediocre quality product became the main focus. They have to make a paradigm shift in their approach – Weed out all the old and corroded management staff, bring in new blood from various sectors, encourage creativity and come up with a unique product that the consumers will love to have. And then keep on encouraging creativity. A huge company does not have to copy in order to survive. Microsoft has enough cash to burn. Hope they change.

    1. I think Microsoft should be true to itself – play to it’s strengths.

      Microsoft should stop trying to be the same as everybody else, and stop trying to be different from everybody else and just be good at what they do best. Good is enough to differentiate one from the rest of the pack.

      1. I shouldn’t be so impolite, but what is Microsoft’s strength? I have come to believe that it’s exploiting their position as a 600-lb gorilla, but they’ve lost that, are disoriented without it, and have no hope of regaining it. I anticipate they’ll become IBM – large, profitable, but wielding little power in their former market. Microsoft will be essentially insignificant, completely so compared to its former self.

        1. Let us to ever forget that Microsofts strength is Windows. And where did Windows come from? They copied Apple. So it is not at all clear that they have the resources to come up with a product that no one has made before. They have no history of doing so. They got into the game by building the OS for IBM systems when IBM was the 800 pound gorilla.

          1. Correction: Apple paid for access to Xerox PARC and developed upon the work they’d done but which they had no idea how to take to market. Microsoft simply copied what Xerox and Apple had done.

          2. True but it’s still copying. They could have easily given credit where credit is due, but Xerox is virtually unknown outside the tech world.

          3. “Xerox is virtually unknown outside the tech world”

            Really? You mean, like copiers in offices?


          4. “you can easily find the facts yourself. If you’re up to it, try searching on the subject”


        2. Microsoft’s strengths are server technologies and development tools. Visual Studio and C# are the best period.

      2. I think Microsoft is starting to do this. Their recent announcements of enterprise MDM encompass devices other than PCs, for the first time. Single sign-on through a Cloud based Active Directory can differentiate Microsoft, playing to their strengths. I see this as good news for everybody.

        As @N8nnc:disqus points out. Microsoft is less significant compared to its former self, but it is playing to its strengths. Microsoft will become the next IBM. Focus on the enterprise. Consumers are fickle. Perhaps consumers are better able to take advantage of the next big thing.

  3. “Microsoft didn’t play to their strengths”

    This assumes Microsoft was great at anything, ever. They seem to be the King of Mediocrity. I’ve never liked any Microsoft product or Windows machine I’ve ever had to use. Microsoft never seemed to care about the details. It was always ‘good enough’ or worse. Maybe that’s changing, but it would take a lot for me to buy into Microsoft again. I use Office when I have to and that’s it.

    1. Microsoft was very good at business. I think they were also good at the core technology, the parts that interested Gates and the other earlier programmers. They were never good at the user interface, which did not interest them. One of the reason’s Apple did so well early on with the “humaneness” of their computers, was they had more of a dynamic duo, the technical Woz and the artsy Jobs. A man to build the guts and a man to form the exterior.

    2. Microsoft is good at iterating to dominance. Windows (Metro fumbles aside, you can switch that off), Word, Excel, Access, SQL Server, Outlook, even (arguably this time) Sharepoint are class-leading products in their respective segments. Thing is, MS need a pre-existing market and competitors to know what to target. They have that now. The “touch” part of Win8 is not an horrendous concept, though its execution is… for now…
      What’s missing is a pivotal mission, that will embolden MS to endanger its legacy businesses, by breaking compatibility and opening up to competitors. Embrace-Extend-Extinguish only works when you’re the 1,000 pound gorilla that MS isn’t in Mobile/Personal.

  4. Lovely quotes, but best of all is your likening of Microsoft to Japanese soldiers still fighting World War II — evocative and fun!

    How better life seems these days, poking the twitching carcass with a stick, than back in Jurassic days when the earth trembled with the giant’s approach.

    1. Thank you for your kind words. Having seen your comment about my WW II analogy makes me appreciate the analogy even more. 🙂 Thanks again.

  5. Lovely quotes, but best of all is your likening of Microsoft to Japanese soldiers still fighting World War II — evocative and fun!

    How better life seems these days, poking the twitching carcass with a stick, than back in Jurassic days when the earth trembled with the giant’s approach.

        1. Thank you for your wholly unsupported conclusions. Please be sure to come back when you have something to add to the discussion.

          1. ?? can’t take someone disagreeing with the article? Although I also viewed the article as an anti Microsoft commercial (the author’s profile states he’s a mac guy) I wan’t going to comment until I saw you jumping on texrat…
            I read the entire article and thought that just because you say something about a company you may like or dislike, and post a bunch of well chosen quotes by other people (including Jobs, lol), it doesn’t prove your point one way or the other. All it makes the author do is look jaded and hurt in some way.
            The author posts no data as reference for his statements, only the opinions of other people, most of which are talking about something else; therefore the statements can be used in absolutely any context a blogger wants them to be. Ask Henry Ford and Ingrid Bergman if they were thinking about Microsoft when they made those statements. Of course not. But the author uses their comments to back up this nonsense.
            Good, you are a Mod. But you aren’t God. Let the 1 guy who was disagreeing with the post make his statements.

          2. “just because you say something about a company you may like or dislike, and post a bunch of well chosen quotes by other people (including Jobs, lol), it doesn’t prove your point one way or the other”

            Wow. So… you didn’t actually read the article, either.


          3. “?? can’t take someone disagreeing with the article?” – Rich in TX

            Stating an unsupported conclusion is not disagreeing, it’s the mental equivalent of placing your hands over your hears and shouting: “I CAN’T HEAR YOU!!!”

            I relish intellectual debate. Show me where and how I’m wrong and I’ll be grateful for your insights. But just telling someone that they’re wrong without providing supporting facts and logic is mere naysaying, not constructive argument.

          4. can’t take someone disagreeing with the article?

            Nothing is more agonisingly stupid than the idea that the mere act of responding to criticism is an act of outrage or denial.

            Let the 1 guy who was disagreeing with the post make his statements.

            He made no statements worth rebutting. Then he followed up on his lack of counterarguments with snide asides. Claiming he disagreed with the article implies that he actually articulated any valid criticisms. He did not.

  6. In the beginning the goal was a PC in every home, twenty years ago, the mission was to show business what they can do with technology. Five years ago the mission changed, to listen to the customer and deliver what they want. Just as Gates had to step aside to allow Microsoft 2.0 to thrive, Steve B had to step aside to allow Microsoft 3.0 to survive. Five years ago, this mission began, but the business suffered due to conflicting goals.

    On one hand, businesses demanded more and more of their resources to develop and manage their ever burgeoning on-premises technology, while on the other hand the consumer market blossomed and passed them by. Microsoft made several half-hearted attempts to engage in this market, from the Zune, to XNA, to Windows Phone 7, but until five years ago, these technologies were not the focus of the business, and the author here is correct that these were at best blunders of epic proportions.

    Five years ago Microsoft started a new vision. This vision was showcased in a project known as Singularity. This vision was motivated by the view that touch would be important, that security was paramount, and that the legacy of Microsoft would need to be abandoned.

    Many people didn’t understand the “ribbon” in Microsoft Office, thinking that it was an obtuse and unnecessary change to the ANSI standard menu system everyone had used for decades. It was actually well ahead of its time, and now that you see Office on touch devices it makes sense. The major changes to the
    Windows platform have been driven from decades of industry standards development and protocol creation with the explicit goal of making all computer systems easy to interface.

    The greatest point to be made about Windows 8, in my view, is not the changes to the UI, but the changes to the system itself. Windows itself is now little more than the branding on the operating system, and while the Windows 8 Kernel is still that of Windows 7, very little of the legacy of Windows 95 and Windows XP remains in the system. Win32 is gone, replaced with a new light-weight and unified Windows Application Programming Interface (API). This API is the same* between the desktop, touch tablets, and phones and has been stripped of baggage that is no longer relevant in the world of today’s technology.

    * Currently there are two APIs, one for the desktop and tablet, and another for the phone, but the differences are minor and the goal of the next iteration of Windows is said to be to unify these two completely.

    The focus of Microsoft 1.0 and Microsoft 2.0 was to build technology first for everyone and next for business, and no one argues that they were successful in doing this. The vision of Microsoft 3.0 is to leverage the position and resources that the business has to provide the tools that both businesses and consumers want, and while the products have not been well received in the media, I have met only a few people who think they are complete rubbish, and generally, I’ve found those people simply lack a foundational understanding of the technology and the ultimate goal of the changes – and most importantly that this lack of understanding is entirely Microsoft’s failure at marketing these new ideas.

    At times, I feel Microsoft is their own worst enemy. Bing is not “just another Google,” it is and was a very different type of engine, but most people assume that since it seems to work basically the same as Google that it must just be the same thing with a silly name. Fundamentally, this is a mistake in education and marketing, because Bing was never meant to be an Indexer, it is a Graph Search engine for big data with strong ties to social media.

    The schizophrenic nature of the transition from Microsoft 2.0 to Microsoft 3.0 has lead to a severe degradation in the trust people once had in the Windows platform. Zune and Windows Phone 7 (among others) did irreparable harm to the interest developers of both software and hardware have in investing in the Microsoft stack.

    Windows 8 is the result of a whole lot of research and effort, and the rapid release of updates and improvements (there have been two major releases so far, 8.1 and the Update released last week) demonstrates this new focus on listening to the consumer and rapidly integrating these demands into the software. Windows 8 represents an entirely new generation of technology, the removal of the entire legacy of Windows 95 and Windows 2000 (Known as Win32) and in my opinion should never have been called Windows.

    The approach was backwards, though. Microsoft should have left the desktop experience alone (or only iterated it SLIGHTLY, as they had in the past), and kept that as the focus of the system, and added the new features as bonuses to functionality, but instead they reached too far and tried to be everything all at once.

    I’ve been using Windows 8 since it came out. It only took me a few minutes to get used to the new features and UI changes, and I found them to be pleasant augmentation to the previous system. Some of the changes didn’t immediately make sense. I purchased a Surface Pro from a Microsoft Store, and I love it. I have a Windows Phone 8, and the unified experience in the cloud as well as the consistent experience between all of my devices is fantastic and using the phone and tablet caused me to understand much better what was going on.

    I was upset when Google decided to drop their iGoogle home page, but I found that the new Start Screen gives me the same experience through Live Tiles, and as far as Google services go, I came to the realization a while back that their business model is to sell your behavior to marketers. I stopped watching television about twenty years ago because of commercials, not content. I stopped using Google services two years ago for the exact same reason.

    Microsoft 3.0 has a lot of potential, and those in the US are a bit isolated from the fact that Windows Phone is actually incredibly successful in certain market segments and in small pockets of the world, and has been consistently gaining ground, but they’re still playing catch up, and they’re not likely to become the “go-to” technology any time soon.

    With some luck, and continued focus on the demands of consumers, I don’t doubt they’ll establish themselves as a key player in the consumer market, because they will leverage their strength, which is the trust and investment that their large corporate customers continue to place in their technology, and as before, this niche will expose more workers to the platform and the benefits provided by the massive ecosystem of products and technologies that most consumers never even hear about. It’s a failure in marketing and leadership, not a failure in technology, and the winds of change are blowing towards a favorable horizon these days.

  7. Welcome to the party, pal! I’ve been predicting this for about 2years — ever since total Android sales went greater than Apples, along with the total “apps” available to Android went past that of the Apple Store. Now Android tablets are more than half of tablet sales. Apple is making the exact same mistakes which it made in the 80s and 90s, keeping prices high and ignoring decreasing market share. The difference between now and the late 90s is that, this time, if Steve Jobs can come back and save their asses, it’ll truly be a miracle.

    Microsoft came to this party way too late… And they aren’t up against Netscape this time, it’s a company with just as much marketing/business savvy as they have, and just as big and deep a war chest to apply against M$ as M$ has against them. So they can’t possibly do to them what they did to Netscape.

    1. “Welcome to the party, pal! I’ve been predicting this for about 2years” – obloodyhell

      Mayhaps ye should read my back catalog of articles before ye accuse me of being a “Jonhnny-come-lately.” to the Microsoft Party. 🙂

    2. Nonsense. The situation is only exactly the same if you are happy with facile claims with no predictive power.

      Making the most money with the best products is only a “mistake” if you think McDonald’s mountain of garbage food is a triumph over Ruth’s Chris steaks.

  8. I just have to share this bit. Purely anecdotal and by no means universal. And I am sure a similar story could be shared about Mac OS, but this is the first time I have _ever_ heard this, myself. I am working with a friend on a show here in Atlanta and she is trying to run the audio cues from her new Windows laptop. We had many issues not really directly attributable to Windows, but while we were troubleshooting she was complaining about Windows 8 and said when she first got her laptop she returned it because she thought it was broken. Then she learned it was how Windows 8 works and had to sit down and have a two hour tutorial on Windows 8.

    This is not a good sign from a consumer perspective. We are geeks, we can figure these things out. We are not everyone, much less a majority. And if we are the only market computer/mobile device/OS makers are interested in, there is no future.


    1. Exactly right. I also notice that geeks and nerds regularly analyze the consumer market based on their experience, their wants and needs (open! specs! etc!). This is a huge mistake, and a big reason why so much analysis is flawed.

      I don’t have much hope for Microsoft succeeding in the consumer market, culturally they seem much more aligned with the geek/nerd crowd, which is in reality a very, very small market.

      1. “geeks and nerds regularly analyze the consumer market based on their experience, their wants and needs” – Space Gorilla

        Agreed. All companies have this problem, some more, some less. They think that their clients see the world as they do. It’s a very normal and natural human tendency (myopia) that needs to be resisted as much as possible.

        1. I think this is where the Liberal Arts + Technology concept comes in re: Apple and the company’s culture. Apple seems to have the ability, culturally, to think outside itself (as a poet or an actor might), to build the computer for the rest of us.

          1. Apple does seem to have a more humanist, existential contemplative streak in them than do most tech companies.


    2. Don’t you need a similar introductory lesson for OSX? I mean Finder is not the best of applications for something so basic. And the plus sign does not do what it says! My point is, it was a new computer with a new OS, you kind of expect some induction is required.

      1. I kind of agree, especially if this were here first exposure to a computer. While I would still consider my friend a novice, she does have a history using Windows. That’s why she went Windows instead of Mac. For her, this wasn’t like going from a single speed bike to a multi-speed bike. It was more like buying a car only to find out it is a motorcycle. Everything she thought she knew, which is already not much, is now wrong.

        Personally, I think all PC UIs suck. There is almost no metaphor used that makes sense or is easily transferable for most people, Mac or Windows. Except typing… Mostly… Except for the difference between typing and typesetting.


  9. Google? replace python scripts with human support that can actually do things.
    Cloud? TrustNoOne encryption – applies to Bing. If the quality is the same, but M$ doesn’t track or violate my privacy and has nothing “creepy” people will start moving.
    Apple? Open things up. Xcode requires a mac, but VS/Linux or VS/Mac can be made, and then figure out how to make the WinApp store better – offer more (Amazon has an Android app store).
    Come out with a Win 8/9 “Zune” – the media player that is NOT a phone but runs all the apps that don’t require a cell chip. (put in a GPS and allow bluetooth headsets).
    Figure out how to converge the XBox into the ecosystem. Right now it is an archipelago – XBox there, WinPhone 8 there, something I don’t know with tablets, and the desktop (Awaiting Win9, it seems even numbered systems suck – Vista and 8).

  10. Excellent article with accurate analysis. Love the Chicken-flavoured vegetable ham! In my opinion, something that’s also very evident looking at latest Microsoft products is that different company divisions seem at war with each other, and a total lack of final integration. It looks like some guys made the metro thing, some others the Windows Desktop part, others the Store … then one day before shipping another guy kind of tried to put it all together with the disastrous usability results. Probably each part kind of fulfilled every slide of the powerpoints given to those in “high management”, but there’s nobody looking at the big picture, not even caring a little about a final result, let alone attention to detail. I feel so sorry for them.