Like most of you, I was bummed when I heard the news that Microsoft was buying Skype. I always have a sinking feeling in the pit of my stomach when a beloved tool/brand is swallowed by Microsoft. (Or even a person—remember Ray Ozzie? He was a rock star before he joined MS! I’m glad he’s no longer there.) I wrote off Microsoft as strategically relevant years ago. Loyal readers will notice that we rarely analyze Microsoft’s moves. Most of our clients just aren’t that interested either.
In the enterprise, MS software is a necessary evil. The MS Office franchise/lock-in has been remarkably successful for almost two decades. Enterprise IT execs have to take Microsoft’s enterprise strategy into account—as they do the strategies of Oracle and SAP—and of HP and IBM. But there’s no innovation involved. Just evolution.
Most of MS’s interesting innovations, IMHO, have been in the consumer gaming area—Xbox and Kinect—for example. In fact, it’s in the consumer world where Microsoft’s brand is actually popular, rather than tolerated.
Microsoft HAS to “Own” a Large Share of Mobile/Wireless Interactions
Finally, there’s Microsoft’s more current public strategic struggle to become a major player in the mobile/wireless field. Now that the majority of information consumption and interaction are taking place on mobile devices, Microsoft can’t afford NOT to be a major platform player in the mobile/wireless world. Microsoft has invested years in mobile OS skirmishes and attempts to woo handset suppliers and telcos alike to a MS-centric mobile ecosystem. Now the company is taking a more heavy-handed and direct approach: buying its way in. First, by mounting a coup at Nokia. Second, by injecting money and support into RIM in exchange for the Bing search franchise. And, now, the real land grab: buying Skype. Notice that Microsoft’s current strategy doesn’t presume that Microsoft owns the mobile OS. It’s playing higher up the stack in the Internet services space (search and real-time interaction).