Microsoft has been behind. As Apple released the iPad and the tablet market grew, Microsoft seemed to sit around and twiddle their thumbs for a few years. The great sleeping giant has now been fully awakened and Microsoft is frantically trying not just to catch up, but to get ahead of everyone else.
The PC market continues to decline, with 2013 seeing the steepest decline of the PC market ever. Even Apple took a hit on their own PCs, as the iPad and other tablets cannibalized their sales. This is the world Microsoft awoke to find itself in.
Windows 8.1 is what Windows 8 should have been. It has more help features, including an entire help app. It has better desktop integration, allowing traditional desktop users to ignore the new Start screen and other “touch-first” features if they like. The new interface is more powerful, with much improved support for multitasking. The included apps are much more robust and make a better case for the new interface, and the Windows Store is also filled with quite a few more apps.
This latest release of Windows was also significant because it came out so fast. Microsoft wants to update their software much more frequently and get on a rapid-release cycle for its products, even Windows. This will allow them to better compete with mobile operating systems and frequently updated web-based software. Yes, that means we hopefully won’t see another greater-than-five-year-long development period like the one we saw between Windows XP and Windows Vista.
Microsoft is faster, more agile — and even listening to customers a bit more. Windows 8.1 devices are making more of a dent.
Nevermind Microsoft’s own Surface PCs, even though they’re dramatically improved in their second versions. The real big story when it comes to PCs is the pricing across the whole market. When Windows 8 came out, computer stores were full of old, no-touch laptops. People flocked to these devices because touch-enabled laptops and tablets were so much more expensive. Many Windows 8 users didn’t even have touch on new Windows 8 PCs.
It’s now possible to go into a store and get a touch-enabled Windows PC for significantly cheaper than an iPad. For example, the Asus T100 transformer book costs just $349 for a full Windows PC with touch. You can remove the keyboard and use it as a tablet, just as you can on Asus’ line of Android Transformer convertibles.
This is the sort of competitive pricing that will give Microsoft’s line of Windows 8 PCs an actual chance against the iPad. Microsoft isn’t really responsible for these prices, but they’re advertising the heck out of them for a reason.
Better yet, PC battery life is also improving to be more competitive with the iPad. That $350 Asus T100 advertises 11 hours of battery life.
Want Microsoft Office? Well, Microsoft still offers a boxed copy of Office 2013, but they’d really prefer it if you bought the online subscription version, Office 365. For $10 per month or $100 per year, you or your entire family get access to Office on up to five PCs or Macs. You also get 20 GB of additional SkyDrive storage space and some additional free Skype minutes.
Microsoft would prefer you buy the subscription, as you’ll always be up to date with the latest version of Office. They’ll also always be able to make money off of you. Microsoft has never been happy that some people are still using Office 97, and they’d rather continue to make money off these Office users. Subscription services are their way to do this.
Despite the downsides, Office 365 is a pretty decent deal if you need Office — especially if there are multiple people in your household who need it. It’s also a big example of how Microsoft is moving to online, software-as-a-service solutions, while still providing choice.
Not content to just improve their own products, Microsoft has also been taking the fight to Google with a series of increasingly embarrassing “Scroogled” ads. Microsoft claims to be doing a public service here, reminding people that Google uses their personal data to target advertising to them in exchange for free services. It’s true, but it’s not necessarily as sinister as Microsoft is painting it. The Scroogled ads also haven’t appeared to make much of a dent in Google’s market share or the public imagination, yet.
Nevertheless, Scroogled ads continue to come out. You can even buy Scroogled merchandise in Microsoft’s online store.
Acquiring Nokia’s Hardware Division
Microsoft is currently in the process of acquiring Nokia’s hardware division. If you haven’t been keeping track of Windows Phone, Nokia is the only hardware manufacturer who’s really serious about it. Acquiring Nokia’s hardware division means Microsoft will now own the highest-quality, most serious manufacturer of Windows Phone devices. They’ll be able to offer a more integrated Windows Phone experience, just as how Apple can offer a better experience by controlling both the iPhone’s software and hardware.
Bringing the biggest Windows Phone manufacturer in-house is a big shift of strategy for Microsoft. Expect to see a much harder Windows Phone push with Microsoft-branded Windows Phone devices. Microsoft is very serious about Windows Phone — they’ve already established themselves as the third player by beating BlackBerry this year. BlackBerry now appears to be in a tailspin, bleeding increasing amounts of money each quarter.
The CEO Search
After initiating a “One Microsoft” reorganization plan, Steve Ballmer announced his intention to resign as CEO. Microsoft has been looking for a new CEO since, and this new CEO will guide Microsoft through their transformation into the “devices and services” company they want to be.
It’s unclear who will end up leading Microsoft at this point, but we wouldn’t be surprised to see a strategic shift as the new CEO sets different priorities and focuses on different markets. A Microsoft not lead by Steve Ballmer will be a different Microsoft.
Microsoft Is Transforming
Microsoft is looking different these days. The slow, lumbering behemoth allergic to change has vanished. They’re changing more quickly than ever, attempting to beat their competitors at their own game. Will they be able to slow the decline of the PC market, or at least position Windows 8.1 devices to grab a good chunk of the tablet market? As we begin 2014, it’ll be interesting to see just how Microsoft’s bold bets pay off.