Windows 8: Microsoft Is Betting The Company

I am one of those who thinks that this week is a seminal moment in computing history. The introduction of Windows 8 is the most important time for Microsoft since the launch of Windows 95. Microsoft’s actions – and the buying public’s response to those actions – is going to change the future of Microsoft – and the future of computing – forever.

Microsoft will survive…

Let’s take a step back and put things in perspective. Microsoft makes – and will continue to make – a lot of money.

Microsoft is really an enterprise company. It makes much of its money from business customers with products like Windows Server, management software, SQL databases and development tools. Those businesses are doing well. Further, Enterprises are upgrading to Windows 7 and the Microsoft Office suite. Microsoft will have most enterprises locked up with agreements for three to five more years. Finally, Microsft is sitting on $60 billion in cash. It has deep, deep pockets.

However, personal computing is no small part of Microsoft’s business. Windows makes up 25% and Microsoft Office makes up 35% of Microsoft’s total sales and a much greater percentage of its profits.

…but their future in personal computing is not assured

There are those who argue that Microsoft has plenty of time, plenty of money, plenty of chances to fix Window 8 even if it goes astray. I couldn’t disagree more.

Did time, money and opportunity allow Microsoft to fix the Zune? Or Windows Phone 7?

Windows 8 on the desktop may or may not do well. But Windows 8 is all about Microsoft’s efforts to transfer their desktop user base to the tablet and smartphone markets. Mobile is the future of computing and Microsoft has absolutely nothing going on in mobile. If Windows 8 does not kick-start Microsoft’s mobile efforts, Microsoft will have missed the boat for good and no amount of time, effort or resources will allow them to swim fast enough to catch up.

Microsoft knows this. They remember well the PC wars of the eighties. In those wars, they were the ones sailing into the sunset, leaving Apple and the Mac floundering in their wake. In today’s world, iOS and Android are the new Windows and Windows is the new Mac. And for Microsoft, that ain’t a pretty picture.

If Windows 8 flounders, Microsoft will survive, but not as the same company we know today

The times, they are a-changing. The decades old Windows-Intel empire is already crumbling. If Windows 8 doesn’t gain traction in mobile, it will be disastrous for Microsoft. We’re witnessing history – we just don’t know yet what the result of that history will be. October 2012 marks a new beginning for Microsoft’s mobile efforts. Or it marks the beginning of the end for Microsoft’s mobile efforts. By this time next year, we’ll know for sure – one way, or the other.

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?

9 thoughts on “Windows 8: Microsoft Is Betting The Company”

  1. I’m with those who say Microsoft has plenty of time to fix anything windows 8. IMO Microsoft could ship Windows 3.1 GUI, on the next Windows and they would still sell hundreds of millions of copies.

    That is the scary power of Monopoly. Customer can complain, but where are they going to go?

    People may not like the next Windows, but most of them aren’t going to
    switch from $400 to $1000 computer because the don’t like the latest
    version of Windows. They will just Grumble and buy another Windows PC.

    I have used it at work and have installed about 6 distros at home
    (Xubuntu 12.04 installed in dual boot right now). But it is still a

    Microsoft can do whatever it wants to leverage the Windows
    customer base, and while there may be complaints,in the end the users
    will basically be saying: “Please sir, I want some more”.

    truly frightening thing, is that Microsoft seems to have finally
    realized they can do pretty much anything they want to the users and
    they will just keep coming back.

    1. People may stay on the DESKTOP version of Windows 8, but if they don’t move to the TABLET and PHONE versions of Windows 8 in numbers, the developers will dry up and the platform will dry up with them.

    2. You’re talking about the desktop market in the enterprise. But Windows Phone has not sold much and that seems unlikely to change substantially; Microsoft has been effectively absent from tablets until now and the Surface probably won’t be serious competition for the iPad; and Microsoft’s stock has been dead money for 10 years. That’s a more complete picture. Frightening? Hardly.

  2. Businesses that have invested in Widows 7 are hardly likely to change to a new and massively different operating system. Those that are still in older systems are equally reluctant to change.

    Microsoft are indeed betting the company as we know it with Windows 8.

  3. You said MS will still be around regardless so I wouldn’t say it’s betting the company. Rather, it’s MS betting its mobile platform or consumer platform future on Win8.

    1. Agreed. I went for hyperbole. But it’s still a big bet. They’re betting their personal computing future. And that’s the face of Microsoft that consumers know.

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