Bevil Wood­ing

Win­dows 10 ush­ers in an era of more per­son­al com­put­ing in a mo­bile first cloud, first world. We want to make Win­dows 10 the most-loved re­lease of Win­dows.

Satya Nadela, Mi­crosoft CEO

Mi­crosoft re­leased its lat­est op­er­at­ing sys­tem, Win­dows 10, last Ju­ly and bold­ly pro­claimed that the launch rep­re­sents a new era in per­son­al com­put­ing. With its ap­proach to Win­dows 10, Mi­crosoft has telegraphed its vi­sion of the fu­ture as well as the se­ri­ous­ness of its in­tent to re­gain lost ground in the tech­nol­o­gy land­scape.

New OS ex­pe­ri­ence

Win­dows 10 promise of a seam­less ex­pe­ri­ence across PCs, tablets and smart­phones and new fea­tures such as voice-ac­ti­vat­ed search func­tion, faster brows­ing, se­cu­ri­ty en­hance­ments and a more stream­lined user in­ter­face. Mi­crosoft goal is to cre­ate "uni­ver­sal" apps with "one ex­pe­ri­ence" across PCs, tablets, smart­phones, Xbox One gam­ing con­sole, and HoloLens; plus the 2,000 de­vices Mi­crosoft says it's test­ing for com­pat­i­bil­i­ty.

In Win­dows 10 Mi­crosoft is al­so of­fer­ing an up­dat­ed op­er­at­ing sys­tem that goes a long way to eras­ing the con­fu­sion and frus­tra­tion that de­fined Win­dows 8. Win­ning over the busi­ness world is a par­tic­u­lar pri­or­i­ty for the com­pa­ny. The en­ter­prise mar­ket was es­pe­cial­ly skep­ti­cal of Win­dows 8, even af­ter the quick-fix Win­dows 8.1 was re­leased.

Mi­crosoft's chal­lenge now is to con­vince the large por­tion of its cus­tomer base that re­mained on Win­dows 7 or those burned by Win­dows 8, that Win­dows 10 is worth the up­date.

The last OS up­grade

In or­der to max­imise cus­tomers, Win­dows 10 is be­ing of­fered as a free up­grade to most users of Win­dows 7 and 8.1. Once Win­dows 10 is in­stalled, Mi­crosoft plans to be­gin a process of con­tin­u­ous up­dates that will elim­i­nate the con­cept of next ver­sions.

Mi­crosoft has clear­ly learned from the painful and ex­pen­sive ex­pe­ri­ence of try­ing to get cus­tomers to up­grade from Win­dows XP and lat­er from Win­dows 7 to 8.

The free up­grade tac­tic is al­ready pay­ing off. Mi­crosoft proud­ly an­nounced that the new OS was in­stalled on over 14 mil­lion PCs world­wide 24 hours af­ter it of­fi­cial­ly launched on Ju­ly 29.

Shift in ap­proach

How­ev­er, this lat­est op­er­at­ing sys­tem up­date sig­nals a more sig­nif­i­cant shift in ap­proach by Mi­crosoft. The de­ci­sion to for­go its tra­di­tion­al rev­enue stream to ac­cel­er­ate the up­take of Win­dows 10 high­lights the rad­i­cal busi­ness mod­el shifts Mi­crosoft must make as it at­tempts to re­turn to rel­e­vance in a tech­nol­o­gy mar­ket now de­fined by mo­bile de­vices and up­starts more adept at push­ing soft­ware as a ser­vice.

De­spite US$77 bil­lion in rev­enue, US$57 bil­lion in gross prof­its and US$21 bil­lion in net in­come, it seemed that the mo­bile rev­o­lu­tion had passed Mi­crosoft by, and with it, con­sumers re­gard for the once-feared tech­nol­o­gy jug­ger­naut.

A plat­form ag­nos­tic fu­ture

Steve Ballmer can be cred­it­ed point­ing Mi­crosoft in the right di­rec­tion for its need­ed trans­for­ma­tion. How­ev­er, it has fall­en to new CEO Satya Nadel­la to ful­ly tran­si­tion Mi­crosoft be­yond Win­dows in­to a new fu­ture of apps and cloud ser­vices.

The task ahead is to rapid­ly grow its user base and, in the process, re­gain the at­ten­tion and in­ter­est of de­vel­op­ers. Mi­crosoft's new mis­sion un­der Nadel­la is plat­form ag­nos­ti­cism.

As the first step to­wards its new OS-ag­nos­tic fu­ture, Mi­crosoft re­cent­ly re­leased its pop­u­lar Mi­crosoft Of­fice Mac OS, iOS and An­droid, round­ing out a com­pre­hen­sive mul­ti-plat­form strat­e­gy for the soft­ware, in­clud­ing Win­dows, Win­dows Phone, Mac, iPad, iPhone, An­droid and web.

It helps that Nadel­la wise­ly moved to make Mi­crosoft's crown jew­el, Of­fice, avail­able for free on iOS and An­droid. The de­ci­sion, com­bined with the sol­id func­tion­al­i­ty of the apps, great­ly eased the pain of busi­ness and pow­er users ex­pe­ri­enced when at­tempt­ing to work across mul­ti­ple de­vices.

It is clear that Mi­crosoft be­lieves it can give it away and still make mon­ey. Mi­crosoft's head of Of­fice mar­ket­ing Michael Atal­la, re­cent­ly told The Verge. "There will still be sub­scrip­tion val­ue, most clear­ly and eas­i­ly iden­ti­fi­able in the com­mer­cial space, but al­so in the con­sumer space around ad­vanced au­thor­ing, analy­sis, pre­sen­ta­tion, and un­lim­it­ed stor­age with OneDrive."

If Mi­crosoft can get more peo­ple in­to its ecosys­tem, they can up­sell them and the or­gan­i­sa­tions they work for, on lu­cra­tive pro­fes­sion­al sub­scrip­tions and en­ter­prise li­cens­es.

Re­ward with risks

The strat­e­gy is not with­out risk. A great desk­top OS alone will not be enough to re­gain the af­fec­tion of con­sumers, or the broad base of third-par­ty de­vel­op­ers that have moved on from writ­ing for Win­dows to build­ing An­droid and iOS mo­bile apps.

An­a­lysts still see Mi­crosoft's small pres­ence in the mo­bile world as a re­al Achilles heel. "Con­sumers are spend­ing the most time on smart­phone," said Ge­off Blaber, an an­a­lyst for CCS In­sight. "This is Mi­crosoft's big, big chal­lenge, be­cause they're on­ly on three per cent of smart­phones.

"They need to be en­gag­ing peo­ple on the mo­bile screen to en­sure that their sur­faces are be­ing used as far and as wide­ly as pos­si­ble."

Fur­ther, com­pa­nies like Uber, Airbnb, Face­book, and Google won't nec­es­sar­i­ly be in­cen­tivised to cre­ate apps for Win­dows, be­cause peo­ple can sim­ply use browsers or mo­bile de­vices to ac­cess their ser­vices.

Win­ning con­sumers

The trans­for­ma­tions of the post-Ballmer era show that Mi­crosoft has the abil­i­ty to piv­ot, and piv­ot hard. No doubt its main­stay busi­ness lines such as Mi­crosoft Of­fice 365, Mi­crosoft Dy­nam­ics CRM and ERP, and Azure cloud ser­vices will con­tin­ue to be ma­jor cash gen­er­a­tors for the com­pa­ny. How­ev­er, the com­pa­ny's for­ay in­to hard­ware such as the Sur­face tablets Lu­mia smart­phones, Band fit­ness wear­ables, and Hololens vir­tu­al re­al­i­ty gog­gles are al­so key to its sur­vival, and prof­itabil­i­ty in the new era of per­son­al com­put­ing it en­vi­sions.

Mi­crosoft well un­der­stands that its fu­ture lies is in sell­ing its soft­ware on as many plat­forms as pos­si­ble. But it al­so un­der­stands that it has to win the hearts and minds of a new gen­er­a­tion of con­sumers.

Mr Nadel­la put it well when he said: "We want Win­dows to go from where users need it, to choose it... to lov­ing it."

Bevil Wood­ing is an in­ter­net strate­gist at Pack­et Clear­ing House, a US-based tech­nol­o­gy re­search firm. He is al­so and chief knowl­edge of­fi­cer at Con­gress WBN (C-WBN) a faith-based based in­ter­na­tion­al non-prof­it or­gan­i­sa­tion and is re­spon­si­ble for C-WBN's tech­nol­o­gy ed­u­ca­tion and out­reach ini­tia­tives. Twit­ter: @bevil­wood­ing In­sta­gram: abright­path