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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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RE: Microsoft Brand Among Consumers
By limitedaccess on 10/27/2010 4:22:44 PM , Rating: 2
You bring up corporate which is a very different market. But my points were strictly from the home consumer point of view. And objectively speaking Microsoft does not have a strong brand image in this area, and there absolute dominance in the OS area really is one due to necessity.

But for the typical consumer (and no I don't mean the "tech savvy" consumer either), Microsoft isn't really a strong brand to them. They will buy an Apple product (even if it is terrible for them) simply because it is an Apple, that is a strong brand image. For instance Microsofts new win 7 phones, do you think the brand name Microsoft/Windows will have the same sway in that market as Apple for the typical consumer?

Microsoft's name has huge clout in the business/corporate market. But these days for the average home user, I do not see it being there at all. They only use MS products because of no real choice or because it's anywhere. Google and Apple for instance both have much strong brand names nowadays. (I use google for search, but own no Apple products or desire them, just to give an idea of my bias)


By captainBOB on 10/28/2010 12:19:36 AM , Rating: 2
Hate to say, the man has a point. Most people outside the tech literate and corporate don't know about Microsoft, all they know is that its a computer and it has a start menu and to go to the internet you double click 'the blue e', they might not even know the name of the OS let alone what an OS is.

Then you mention Apple, they think iPods, iPhones, iPads. What happens when they realize that Apple makes computers, they'll think if their iPod/iPhone is awesome then an Apple computer is awesome too, even with the 1000+ price tag. This is just something Microsoft doesn't have in the consumer market. People could watch an ad about Windows 7 and not realize it if it wasn't mentioned, while an Apple ad...instant recognition.

What would happen if hell froze over and Apple sold their products for 99% off MSRP for one fiscal quarter?


"What would I do? I'd shut it down and give the money back to the shareholders." -- Michael Dell, after being asked what to do with Apple Computer in 1997














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