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Steve Ballmer is pained by his company's struggles, but his attempts to turn around his company's struggling units have seen little success thus far.   (Source: Reuters)

Microsoft Zune is one of the company's struggling products. Others include its search efforts, its mobile phone efforts, and its tablet efforts.  (Source: LIFE)
CNN Money says that the end may be near for Microsoft's attempts to appeal to the masses

Amid record profits Microsoft has serious cause for concern.  It is coming off the high of the fastest-selling operating system in its history -- Windows 7.  That OS sent its profits soaring and convinced some that Microsoft was no longer on the retreat.

But part of Windows 7's success was due to how poorly received Vista was.  With Windows 8 landing reportedly in 2012, the company may have significant difficulties in convincing the average consumer to upgrade to its latest and great OS.

Other than the Windows brand, Xbox and Microsoft Office are the company's other two major successes in the consumer sector.  But the Xbox trails Nintendo's “family friendly” Wii and the Office team is getting seriously nervous about growing consumer interest in OpenOffice.

On the other hand, Bing has failed to gain even 10 percent of the search market in most metrics, despite a massive ad push and a deal with Yahoo. Zune remains a tiny player in the MP3 market, having failed to become a true competitor in terms of sales to Apple's iPod line.  And Microsoft's smartphone empire, once a major player, is in rebuilding mode after the disastrous Kin and ill-received Windows Mobile 6.5.  It is placing its hopes on Windows Phone 7, but that phone enters a packed market.

Internet Explorer, Microsoft's browser, has long led the market, but has seen a steady decline in recent years, which may allow Firefox and Chrome to eventually reach its formerly insurmountable market share peak.  Microsoft's key hope here is a new product, Internet Explorer 9.  

So while it seems that 
CNN Money's recent headline, "Microsoft is a dying consumer brand", is a bit sensational, it is a claim that is grounded in some reality.  

One of the key points in the article is that aside from the struggles of many of Microsoft's consumer "expansion" business units, it is also bleeding executive talent, like many other struggling firms (HP, Yahoo, etc.).  States the report, "Microsoft's executive suite is in turmoil. CFO Chris Liddel, entertainment unit head Robbie Bach, device design leader J Allard and business division chief Stephen Elop have left within the past year. Ray Ozzie joined the exit parade last week."

The report praises Microsoft's recent efforts, but concludes in cautionary fashion, "Microsoft just has to hope [they're] not too late."

Much like the Romans or Greeks, Microsoft has built a mighty empire, a key part of which are expansions into new arenas -- in Microsoft's case phones, video game consoles, and internet services.  

But much like the Roman empire fell, Microsoft appears dangerously close to losing its expansions to hungrier parties.  But much like Rome, it will likely hold on to its central holdings (Windows, Internet Explorer, Xbox, and Microsoft Office) for some time, even if its other efforts fall into commercial purgatory.

The talent gap is absolutely a concern for Microsoft.  And equally concerning is the fact that the company is being led by Steve Ballmer.  Mr. Ballmer, while a brilliant tactician in some regards and a man with obviously enormous love for the company, has failed to execute a strategy to turn around the company's struggling units -- or one that works at least.  

To succeed, Microsoft may need to move on without Mr. Ballmer.  But who to pick to lead the world's largest software company, perhaps the most powerful technology company in the world?  The leading candidates have already left the company.  That means that, essentially, there's no easy answer to Microsoft's leadership issues and that the ongoing risk to the company is tremendous.

Is Microsoft's consumer brand "dying"?  Not yet, in our minds.  But it lacks the hunger that it once did.  And it most certainly sorely misses the leadership of its founder and chief visionary -- Bill Gates.

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An image problem
By iWriteFlops on 10/27/2010 4:16:47 PM , Rating: 2
I have to agree with this article. In fact, I'd been thinking the same thing lately.

The problem with Microsoft is not that they lack innovation or that they lack resources. The main problem with Microsoft today is image. Ask any high school kid who's heard of Apple and Microsoft what they think of each company. With the exception of the xbox, they will say Apple = cool, Microsoft = old . You can't sell products to consumers when people automatically dismiss them as antiquated before they've even tried them. Consider the new Windows Mobile Phones. Was anyone lining up for them? I can't even tell you for sure if they're available for purchase or not. A lot of people did line up for the iPhone 4. And it's not because it is an awesome phone. It doesn't even make phone calls half the time. It's because to a lot of consumers Apple products are "cool" and Microsoft products are not.

To add to the problem we live in a country that loves good stories. Who has a better story than Steve Jobs right now? He’s the closest we have to a super hero these days. The guy got kicked out of his own company. His ideas were stolen by Microsoft (I know that's not true, but that's what people think). He comes back from all of that to take over the industry. It doesn't get better than that. Then, he even gets sick and survives. The guy could sell pet rocks and everyone would buy them.
Microsoft started in much the same way, a band of geeks going against the giant, IBM. Bill Gates, a kid with a dream of having his software in every home. Great American story. What's the story now? They became wealthy, lost track of their roots, their leader retired, and so the story ends.

You want to know how to sell Windows 8? New story: A small group of Microsoft developers from the xbox division, unhappy with the direction Microsoft has taken with consumer products, breaks off and forms their own company. Their mission to create a new OS that's easy to use for consumers: fast, not bloated. It's going to do what iOS does well but run Windows applications too, just because it can, just to get back at Microsoft. It's not going to be called Microsoft anything, or Windows anything. And it's going to be open source from day one. Small band of developers going against giant Microsoft (of course, they will be funded by Microsoft but no one will think about that.) Then, if you want to be really cool, have the head of that group meet secretly with Bill Gates to get ideas.

I know, that sounds far-fetched, but in my opinion the main thing Microsoft needs is a new image, a new story, and sadly pride may be the thing that kills them at the end.

RE: An image problem
By Pirks on 10/27/10, Rating: -1
RE: An image problem
By Boze on 10/27/2010 10:07:14 PM , Rating: 2
I'm sorry but I don't think you could possibly be more wrong.

Windows 7 revitalized the consumer image of the Windows operating system family. Even though I found Vista to be a very good and stable operating system, I was about one month from switching to a Linux variant when Microsoft offered Windows 7 RC1 for download. And I have never looked back. I've wanted to make a Hackintosh, but I've come to realize: What's the point? Windows 7 is a superior operating system that I can run on most any hardware available and works with almost every piece of software and hardware I'd ever want to use.

As far as your crack at Indian technical support, my girlfriend recently purchased a Microsoft Wireless Keyboard 6000 v3.0 - which sadly is plagued with problems, and I don't know if its just that keyboard and Windows 7, or that keyboard period, because I no longer have any XP or Vista machines to test on - which has had technical problems. I called in her stead (she's terribly non-technical) and the Indian gentleman that assisted me was wonderful. Not only did do everything he possibly could have to fix our problem, he shipped us a Microsoft Wireless Laser Desktop 6000 (mouse and keyboard), brand new in a retail box. The entire turnaround time was 6 days. Now unfortunately, she still has problems with the keyboard (randomly stops functioning for some reason), but I feel confident that when I call back tomorrow, Microsoft is going to work diligently to fix my issue. Microsoft's warranty on their hardware products (minus XBox 360 I guess... I don't know personally) has been flawless, from my personal experience.

I think one of the biggest missteps was Microsoft not actively pursuing the Courier. Even if they were a year, or even two years, later down the road than iPad, Courier would have been a hit with corporate customers and professionals, and probably would have caught on with specific segments of the consumer population (high school / college students).

Microsoft could certainly turn their situation around, but they're going to need to stop internal bickering and more forward as a cohesive unit.

RE: An image problem
By Pirks on 10/28/2010 11:19:46 AM , Rating: 1
one of the biggest missteps was Microsoft not actively pursuing the Courier
Hence you agree with my point about necessity for MS to develop their own hardware and integrate it vertically Apple-style. Good.

RE: An image problem
By Reclaimer77 on 10/27/2010 5:27:58 PM , Rating: 2
A small group of Microsoft developers from the xbox division, unhappy with the direction Microsoft has taken with consumer products, breaks off and forms their own company. Their mission to create a new OS that's easy to use for consumers: fast, not bloated. It's going to do what iOS does well but run Windows applications too, just because it can, just to get back at Microsoft.

And they'll be sued into oblivion. Because they only way they could possibly do that is if they had stolen Windows source code before they left.

Your post is one big science fiction short story.

Who has a better story than Steve Jobs right now?

Bill Gates. There will NEVER be a better "story" than that, come on get real.

RE: An image problem
By Fritzr on 10/28/2010 3:23:20 AM , Rating: 2
It's already being done. Look up the WINE project and it's commercial fork called Crossover.

All that is needed for the stated scenario is for Microsoft to join WINE as a contributor or buy out the Crossover people and continue Crossover as an "independent" operation.

There was an earlier attempt at a Windows compatible Linux called Lindows that was successfully sued out of existence, but Crossover and WINE are peacefully chugging along with the process of adding MS Windows compatibility to Linux. Without MS support and the need to do a clean room write of API support (including undocumented APIs) it is slow going. With MS support the WINE project could successfully kill the market for the MS product on low end and older machines as well as making a dent in new equipment installs.

Add the functionality of the Enterprise support tools and Linux+WINE could be the new Compaq.

RE: An image problem
By Reclaimer77 on 10/28/2010 9:10:20 AM , Rating: 3
WINE is a pain in the ass. Compared to the thousands of thousands of Windows apps out there, WINE has a very short list of supported programs that install and run right out of the box. Then there are those who will install and run, but have some type of broken functionality.

I know Linux geeks have been singing the praises of WINE for a long time, but it's still nowhere NEAR comparable to installing and running native Windows apps on a Windows machine.

RE: An image problem
By The Insolent One on 10/27/2010 11:38:25 PM , Rating: 2
Actually, that is a great idea and it's something MS should have been thinking about a long time ago.

Face it, people are tired of spyware and virii, and service packs, and BSODs. They want an "appliance" kinda like their tv or their oven. They turn it on, it works, end of story.

RE: An image problem
By Wererat on 10/28/2010 9:01:56 AM , Rating: 2
>They want an "appliance" kinda like their tv or their oven.

Apparently not, or else they'd have been buying Macs overwhelmingly since 1984. People do like choice, even when the uncountable combinations of hardware cause incompatibilities, disparities, and other assorted varieties of dismay.

More to the point, quite a few enthusiasts *really* enjoy this customization and astoundingly, when Joe Average looks for advice, he turns to his enthusiast buddy/relative, who is not using an 'appliance' computer.

MS' problem IMO is that in most areas they're the follow-up to an already cool innovation. The article has a good point in that when the innovators and leaders are gone, the chances of a new fresh product are pretty slim.

RE: An image problem
By The Insolent One on 10/30/2010 4:42:14 PM , Rating: 2
If you're trying to compare today's market to the market that existed pre-Internet and/or pre-browser, then you might want to recheck your equation.

As for how much control "Enthusiasts" exert on a market, it has about the same effect as a fart in a forest.

I know that everyone hasn't gotten the memo yet (most have), but the desktop computer has long ago ceased to be the dominant hardware. Even since laptops took over, the trend is clearly showing that mobile platforms are going to do the same to the laptop.

People love to squak about choice even at places like McDonald's. "Give us healthy alternatives" they say. McDonald's offers them on the menu and you know what happens? No one buys them. Having choices sure sounds good, but they don't actually sell.

Fast forward 5-10 years and mobile will be the clear platform of choice, and Microsoft's consumer brand (B2C, which is what the CNN article is referring to) will be a footnote to history.

"People Don't Respect Confidentiality in This Industry" -- Sony Computer Entertainment of America President and CEO Jack Tretton

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