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J. Allard (left) was a rising star at Microsoft but reportedly threatened to quit after Microsoft scrapped the promising tablet project Courier. He has reportedly since either quit or let go.  (Source: Sydney Morning Herald)

Microsoft is reportedly planning some major rearrangements for at least one of its struggling divisions.  (Source: Switched)
Microsoft tries to salvage its struggling divisions

Microsoft's Window 7 is a huge hit, passing its predecessor Windows Vista and soaring towards passing Windows XP.  Microsoft's Xbox 360 is finally yielding a net profit (unlike the first Xbox, which lost Microsoft billions), and is currently in second place behind only the Nintendo Wii.  The outlook for the Xbox 360 looks only to improve with the launch of Project Natal, a slick 3D camera-controlled system.

However, for some of Microsoft's other divisions, the picture is looking increasingly grim.  Sales of Windows Mobile 6.5 phones are plunging amid tough competition from Google's Android, the iPhone, and RIM's Blackberry smartphones.  And Windows Phone 7 reportedly will have a number of key features missing at launch -- copy and paste (which will reportedly only be available within the mobile version of Office), multi-tasking, and home screen customization.

The Zune has also struggled.  It saw sales drop off in 2008 and 2009 after initial enthusiasm.  Despite nice hardware and a promising music subscription service, Microsoft has been largely unable to successfully market the product.

As a result of these problems Microsoft is reportedly planning a major shakeup of its Entertainment & Devices Division, according to 
The Wall Street Journal.  This division covers the Xbox, Zune, and Windows Phone businesses and made $1.67B USD in the first quarter of this year, or roughly 11 percent of Microsoft's total revenue.

Among the current departures that are broadly thought to occur is the departure of J Allard, the chief experience officer and chief technology officer.  Allard was reportedly leading Microsoft's Courier tablet project.  Despite a relatively positive reaction from the public, Microsoft curiously decided to scrap plans of bringing the device to market.  The Courier could have proved a key competitor to Apple's iPad, which may move 8 million units this year, according to at least one analyst.

Allard was reportedly angry that Microsoft scrapped the project, which seemed so promising.  He threatened to quit, and reportedly was subsequently shown the door by Microsoft CEO Steve Ballmer.

Robbie Bach, a 22-year Microsoft veteran and the division's president, may be another target.  Otherwise, a broad shakeup is expected across the middle level management ranks.

The question becomes whether Microsoft will execute a similar shakeup of its internet division.  Despite scoring a big partnership with Yahoo in 2009, which made Microsoft's Bing power Yahoo's search, the pair have since floundered.  According to market research firm Net Applications, Bing has fluctuated around 3 percent, but failed to produce significant growth.  Yahoo, meanwhile has continued to plunge, dropping from 7.16 percent in July 2009 to 5.30 percent in April 2010.

No such shakeups of the internet division have been hinted at, but Microsoft obviously needs some sort of new direction in this division as well.  The Entertainment & Devices changes are expected to be announced within the upcoming week.



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What they need to do for their mobile market.
By quiksilvr on 5/25/2010 9:35:19 AM , Rating: 5
Get those basic features (multi-tasking, copy and paste, etc.) AT LAUNCH. This isn't the time or the place to come out with a half-assed OS. In this market, these lack of features stand out like a sore thumb (remember iPhone? Took them 4 years to get all their basic features in check, assuming iPhone 4 will have a decent multi tasking system).

Once they got these features, they have to literally FLOOD their Marketplace with applications as soon as humanly possible. Imagine at launch they can say "We have 10,000 apps" (please no lame over 9000 joke...) they can really get into the fray of this crazy mobile competition.




RE: What they need to do for their mobile market.
By SkierInAvon on 5/25/10, Rating: -1
RE: What they need to do for their mobile market.
By Mitch101 on 5/25/2010 10:49:42 AM , Rating: 1
As it was explained to me.
You know the difference between one billionaire and another? Nothing. Its not like on can get a better steak than the other. Your never going to see Gates/Balmer pumping gas for a paycheck. Microsoft never really had a Phone market share to talk of so why are they suddenly considered failing without one? Microsoft was built on OS's and Applications not Phones and MP3 players. How many people laughed at Microsoft when they said they were entering the game console market? Microsoft eventually gets it right.

Now what amazes me is Apples stock price because its purely speculation. Their market share in computers has increased minimally in the last couple years. Its probably decreasing because of Windows 7. Their iPhone market is getting cut by Google's droid. The iPad is nice but going to have a lot of competition soon. Every area of Apple is getting a trim or soon to get a trim by Google, Microsoft, and HP-Palm (Possibly) yet their stock is increasing? Speculation tells me if Apple isn't developing a search engine that the wolves have found their weaknesses and are closing in fast.


By StevoLincolnite on 5/25/2010 11:09:02 AM , Rating: 2
quote:
How many people laughed at Microsoft when they said they were entering the game console market? Microsoft eventually gets it right.


I have to admit, I laughed at the idea of Microsoft entering the home console arena at one stage...

Then I started to notice the game companies that they were buying up like:

Ensemble Studios (Age of Empires), Rare (Perfect Dark, Golden Eye, Banjo, Killer Instinct) and Lionhead (Fable, Black and White).

And then you have Bungie... Halo when I first saw it was a third-person action game, that I was actually really hyped up about for the PC and Mac, never did I expect it to be such a huge hit (While being turned into an FPS) and essentially be a console mover for Microsoft.

The idea with the Xbox platform, was that Microsoft never intended to be a big success with the first iteration of the Xbox, which was also the same mentality that they had employed with the Zune as well.

Mind you, I think you will find that the Xbox had a much larger advertising push, and was sold in more regions across the planet in comparison to the Zune as well.


RE: What they need to do for their mobile market.
By sebmel on 5/25/2010 6:14:34 PM , Rating: 2
"Apples stock price because its purely speculation. Their market share in computers has increased minimally in the last couple years. Its probably decreasing because of Windows 7."

Q1 2010: Mac sales up year on year 33 percent. Over the "last couple of years" they are up a couple of hundred percent. More importantly they are dominating the $1000 and over market... where the money is. Dell still sell far more computers than Apple but make much less money. It isn't wise to mix up business sales with far more lucrative consumer sales.

"Their iPhone market is getting cut by Google's droid."

Q1 2010: iPhone sales up year on year 100%.

"The iPad is nice but going to have a lot of competition soon."

The iPad sold at twice the rate of the iPhone in its first weeks. Analysts are currently predict total first year sales of 8 million. These are not xBox style, loss leader sales. Apple's margins are up: 40.9 percent from 37.9 percent a year ago.

"Every area of Apple is getting a trim or soon to get a trim"

Well, actually, it was a record quarter for the company. Overall, the company posted revenue of $15.68 billion and a net profit of $3.38 billion. That means revenue was up about $4 billion versus a year ago, while profit was up over $1 billion.

But, iPod sales were down, probably due to smartphones, including the iPhone, taking that market.


By Mitch101 on 5/25/2010 8:21:33 PM , Rating: 3
http://tech.fortune.cnn.com/2010/04/22/chart-where...

Take away iPhone and your almost back to where you were in 2007.

BTW the chart is starting to slope downward.


RE: What they need to do for their mobile market.
By Calindar on 5/25/2010 8:56:39 PM , Rating: 3
"Q1 2010: Mac sales up year on year 33 percent. Over the "last couple of years" they are up a couple of hundred percent. More importantly they are dominating the $1000 and over market... where the money is. Dell still sell far more computers than Apple but make much less money. It isn't wise to mix up business sales with far more lucrative consumer sales."
Considering we are coming out of a recession and computer sales as a whole grew 28%, having 33% growth with such a small market share isn't really that impressive.


By Mitch101 on 5/26/2010 7:04:16 AM , Rating: 3
Yup just like lumping in iPod sales with iPhone sales to ignore the fact that Droid sales surpassed Apple's phone.


By Anoxanmore on 5/25/2010 10:08:41 AM , Rating: 2
Over nine thousands jokes are not lame. :p

"Can it run Crysis", is.


By Scrogneugneu on 5/25/2010 10:50:09 PM , Rating: 2
What about "Can it run Crysis at over 9000 FPS" ?


RE: What they need to do for their mobile market.
By chmilz on 5/25/2010 10:40:37 AM , Rating: 2
And schoolkids could have marketed the Zune better. MS totally botched that by only selling in the US, and failing to actually advertise anywhere that they had a product to sell.

Seriously, anyone ever actually see a Zune advertisement?


By StevoLincolnite on 5/25/2010 10:52:21 AM , Rating: 2
quote:
Seriously, anyone ever actually see a Zune advertisement?


I haven't even seen a Zune for sale, let alone an advert...


RE: What they need to do for their mobile market.
By Mitch101 on 5/25/2010 11:05:11 AM , Rating: 2
Yes Ive seen them. They tried to be cool and colorful but the problem with the Zune is the lack of apps. For about the same price the iPod has tons of apps and games. Zune was marketed as an MP3 player. The iPod was marketed as a MP3 Player, Video, Portable Game machine, and Portable App player. Apple iPod marketing clubbed Microsoft marketing like a baby seal. Nobody wants a $200.00 MP3 player and thats what Microsofts commercials were doing pushing a music player and not its additional abilities.

I have not seen a Zune HD commercial but I suspect thats because shortly after the Zune HD was released internally they knew they were going to scrap it and come with the Zune HD2 which is along the lines of the Mobile 7 phone hardware. Supposedly the command to scrap everything and start fresh was issued shortly after the Zune HD was released. Actually I hear the name will not be Zune HD2 but will be scrapped in favor of something fresh because they want the device to have a fresh start.


By clovell on 5/25/2010 11:53:46 AM , Rating: 2
Honestly, I know the Zune was late to the party with games - but I've never in my life seen anybody play a game on an iPod or iPod Nano - it's always on an iPhone or iPod Touch, which are in a completely different market segment. When Zune finally came out with games, there weren't many at all; I played Texas Hold 'Em to make plane rides go by quicker.

The Zune wasn't marketed, really - period. I've always bouth the Sunday paper on discount just for the coupons. Every week there's a half page dedicated to iPod stuff in the Best Buy ad. Zune gets about a quarter page every two or three weeks. It's just bad.

The Zune was the better device. The Zune Pass for $15/month, giving you unlimited downloads on a subscription model + 10 songs/mo on a purchase model. The software is beautiful. The damned thing can synch wirelessly, the stock earbuds don't suck. Literally, if you get a car kit, you can leave the Zune in your car and synch it wirelessly from your garage to your home network.

But - people didn't know that. Because Microsoft never told them. Microsoft also botched marketing by not allowing more third-party partners to develop accessories, which always pissed me off that you could never find a Zune Alarm Clock (I know they made one, but only for a few months, and it sucked).

The HD is nice - both my brothers have one. I just hate how they cannibalized their previous lineup. If they could have kept the previous lineup in production at a lower price, they would have sold so much better. The next gen Zunes, imo, should take advantage of their subscription model for music. One of the things I hate is having my player so crowded with music that I have a hard time finding the new stuff I just downloaded to listen to.


By sebmel on 5/25/2010 6:19:52 PM , Rating: 2
"They tried to be cool and colorful"

I believe their initial idea of colorful was pigsty brown:

http://www.zuneworld.com/images/Brown-Zune-Large.j...


Google already won this fight with a knockout punch
By Xarthos on 5/25/2010 10:08:41 AM , Rating: 2
What does this Microsoft OS do that my Droid Incredible doesn't do right now?

Xbox 360 connectivity will not win this fight.




By StevoLincolnite on 5/25/2010 10:49:21 AM , Rating: 2
quote:
Xbox 360 connectivity will not win this fight.


For me it will, especially if I can do VOIP with my Xbox 360 friends list and play a few Cross-platform Arcade games with each other (Perfect Dark Arcade anyone?).

...One mans trash is another mans treasure...


By corduroygt on 5/25/2010 12:45:04 PM , Rating: 2
Even if it could, you'd need a good wifi connection for that. 3G is just too laggy.


By Mitch101 on 5/25/2010 11:11:36 AM , Rating: 4
OK on a consumer level Droid/iPhone/Mobile 7 will all be quite similar except iPhone may be hindered by AT&T. It may be just carrier choice for those who dont own an X-Box 360. If you own an X-Box 360 then Microsoft Mobile 7 may have some additional influence.

On the corporate side Blackberry/Mobile 7. Microsoft will be utilizing the most features from Active Sync and will be a big benefit and cost cutter to E-Mail/Exchange, Communicator, and Sharepoint environments. Mobile 7 should be a real competitor to Blackberry in the corporate world. Droids and iPhones are not business ready. Sure you can make them work in a corporate environment but if you value security you wouldnt do that.


By quiksilvr on 5/26/2010 9:23:42 AM , Rating: 2
I disagree. This same argument was made in the past but everyday we are seeing more and more people switch from Blackberry/WinMo to Android and OSX.

You can have the best of both worlds in Android and OSX. Business with pleasure. E-mail/Exchange, chat and sharepoint along with VPN clients, access to your desktop remotely, etc, are all available.


By EasyC on 5/26/2010 12:03:22 PM , Rating: 2
-Install apps to the SD card without hacking.
-Ability to "shell" the interface to different variants (not just add extra widgets).
-Ability to sync more than month to exchange
-ActiveSync. Sorry but I like syncing to my computer, not googles server.

I could go on.


It all starts at the top
By frobizzle on 5/25/2010 10:37:32 AM , Rating: 3
It's easy to see the root cause of Microsoft's woes. Ballmer is a buffoon, a doofus, that will have a legacy equal to HP's former CEO, Carly Fiorina. Ballmer needs to step down and let someone else take the helm or Microsoft will suffer in the long run.




RE: It all starts at the top
By StevoLincolnite on 5/25/2010 10:51:19 AM , Rating: 2
quote:
It's easy to see the root cause of Microsoft's woes. Ballmer is a buffoon, a doofus, that will have a legacy equal to HP's former CEO, Carly Fiorina.


On the bright side, Steve' is one of the funniest CEO's around.


RE: It all starts at the top
By sebmel on 5/25/2010 6:21:52 PM , Rating: 2
It would be an asset if people weren't laughing at him.


RE: It all starts at the top
By RjBass on 5/25/2010 10:50:05 AM , Rating: 2
agreed.


RE: It all starts at the top
By jrussell55 on 5/25/10, Rating: 0
Still floundering
By mcnabney on 5/25/10, Rating: 0
RE: Still floundering
By PAPutzback on 5/25/2010 10:09:24 AM , Rating: 3
The 360 did well because it was out almost year and a half before the PS3, had a great online experience and was a few hundred dollars cheaper.

The courier would have been nice to see come out. I like the idea of a two screen book like device. That way you can close it and throw it in a bag, separate the keyboard from the screen, and hopefully multitask with an app on each screen.

And WHS could be awesome if they would listen to the community but a lot of things like central TV tuning might no be something they can do because of DRM or the capability of hardware they are designing th O.S around. For a 24/7 machine you don't want to run quad core CPUs to process video and handle extenders. It would be a nice option though.


RE: Still floundering
By Mitch101 on 5/25/2010 11:21:52 AM , Rating: 3
Everyone I know using Window Home Server loves it and praises it. The problem is nobody except geeks know about it.

Its like Small Business Server most enterprise level admins wont give it the time of day but its an incredible package of products bundled together.


Chief Experience Officer??
By luhar49 on 5/25/2010 2:01:54 PM , Rating: 2
quote:
J Allard, the chief experience officer and chief technology officer.


Chief Experience Officer.....is that a new designation ?




RE: Chief Experience Officer??
By The0ne on 5/25/2010 3:26:36 PM , Rating: 2
Yes, I think so. It's like my boss's new title...Very Senior Director VP of Product Management, Manufacturing and Laziness.

But please don't give Jason crap about his spelling, they're perfect to begin with. Go have your eyes check.


pic
By Etern205 on 5/25/2010 12:34:15 PM , Rating: 2
Looks like Ballmer is going for a dive. :P




Where should the shakeup start
By ChipDude on 5/25/2010 12:45:37 PM , Rating: 2
At the TOP!

When big successfuly companies start failing; Vista, Zune, Search, cloud computing you name it.

The fault lies in the larger strategic direction. Its the CEO who defines that. The troops, divisional chiefs and all simply march to the vision of the CEO.

I think if there is a shakeup it starts with the Board revisiting is Balmer the right person to lead this company. No company today can rival MSs pocket book or resources except maybe google, but boy is MS resources missdirected at the moment, chasing the competion versus deciding what the next big thing is and being there first. Google is excuting to a vision, Apple is excuting to a visions. What the hell is Balmer doing?




BALD Ballmer
By bigbrain on 5/25/2010 10:19:25 AM , Rating: 1
I have only one person to blame for MSFT woes Steve Ballmer. Microsoft had many devices and people that were way ahead of what the market was looking for, however, Mr. Ballmer allowed these products to be scrapped and be brought back to life via competitors. Since Bill Gates left MSFT is nothing more than a huge company that truly lives off of its previous products and nothing more.




Trouble in the Mobile Space
By MrX8503 on 5/25/2010 12:59:44 PM , Rating: 1
Microsoft is in serious trouble in the mobile market.

Zune HD
WinMo 6.5
Courier

Zune HD didn't sell as well as expected, WinMo 6.5 is a dinosaur of a mobileOS, and the Courier was axed. That is a total of 3 failures and the Courier looked so promising. By comparison Apple has the iPod, iPhone, and now the hot selling iPad.

Microsoft needs WinMo7 to be successful, they are already 4 years late. It is completely unacceptable to exclude copy/paste and multitasking while entering the ring with heavyweights from iPhone and Android OS.

On top of this, WinMo7 has no apps entering the market. Hopefully Microsoft can pull a miracle coming 4 years late to the game.




"Spreading the rumors, it's very easy because the people who write about Apple want that story, and you can claim its credible because you spoke to someone at Apple." -- Investment guru Jim Cramer














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