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Microsoft has lengthy prided by itself on its open companion ecosystem and cited it like a crucial differentiator from Apple, which delivers all the hardware and software program for its products.
But that equation may be set to change, depending on a somewhat cryptic comment from CEO Steve Ballmer inside a notice he sent to personnel on July 23 about President Kevin Johnson’s surprise departure from the company. From Ballmer’s e-mail, discussing Microsoft’s priorities for fiscal 2009: “In the competition between PCs and Macs, we outsell Apple 30-to-1. But there is no doubt that Apple is thriving. Why? Because they are good at providing an experience that is narrow but complete, while our commitment to choice often comes with some compromises to the end-to-end experience. Today,Office Home And Business 2010, we’re changing the way we work with hardware vendors to ensure that we can provide complete experiences with absolutely no compromises. We’ll do the same with phones–providing choice as we work to create great end-to-end experiences.” During his kick-off speech at Microsoft’s annual financial analyst meeting (FAM) on July 24 in Redmond — where I’m sitting in the audience right now — Ballmer emphasized that Microsoft wants to ofer users not just more choices with Windows PCs, but “every choice” in pricing and design that Apple provides. He told Wall Street analysts, market research folks and press in attendance that Microsoft is going to increase its spend on marketing,Office Home And Student 2010 Key, compared to sales, on a per-unit basis in fiscal 2009, as Microsoft currently spends a lot less than Apple does when talking about PCs and phones. Ballmer didn’t offer specifics in his e-mail to workers or at FAM about how he is planning to change Microsoft’s relationship with its PC and phone maker partners. But he’s the one who will be setting more and more of Microsoft’s Windows direction, depending on the shake-up announced on July 23, whereby Microsoft is splitting Windows/Windows Live from its Online Services Business. Microsoft is seeking a new head for OSB but Ballmer is going to be the one running Windows/Windows Live,Microsoft Office 2007 Key, with input from three of the company’s senior vice presidents. In the current Windows world,Office 2010 Sale, Microsoft is at its OEMs’ whims. Microsoft can and does encourage these partners to build more different kinds of PCs and phones to appeal to both business and consumer customers. Ultimately,Microsoft Office 2007 Ultimate, however, it has been up to HP, Dell, Lenovo, Samsung, HTC, etc., how they package and price Windows and Windows Mobile systems. Might Microsoft be tightening up the guidelines it will to which it will require its hardware partners to adhere — particularly in the area of driver compatibility? Could Microsoft force PC makers to stop loading crapware on new machines, in the name of improving users’ out-of-the-box experiences? I am doubtful we’re going to see Microsoft-developed and -branded PCs and phones. But given that Microsoft makes Xbox gaming consoles and Zune media players, such a move wouldn’t be completely unprecedented. Beyond launching a new, $300 million marketing campaign expected to be aimed at Apple, what do you expect Microsoft to do to change its relations with PC and phone makers in the coming months? If you were Ballmer, what would you do? Update: During his presentation as part of FAM, Microsoft Entertainment and Devices Chief Robbie Bach dropped what may very well be another hint about Microsoft’s changing OEM gameplan. Bach told attendees that Microsoft is very focused on improving the “shopping process when people go to buy new PCs.” Update No. 2: During the final Q&A session at FAM, when asked by a Wall Street analyst about what he meant by his “changing the way we work with hardware makers” comment, Ballmer said Microsoft is working with its OEMs to “show them additional choices they can make” to make PCs and devices work better. For example, by configuring a laptop one way, boot times can be made faster, Ballmer said. He did notice that Microsoft realizes that the Consent Decree with the U.S. Department of Justice, ensures that OEMs can preload any software program they want on any machines. But Ballmer said he expects “some OEMs will step up” to make these kinds of changes and improve users’ end-to-end experience with Windows and Windows Mobile systems. |
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