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12/19/2011
01:46 PM
Paul McDougall
Paul McDougall
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Microsoft's Dumbest And Smartest Moves Of 2011

The past year was one of highs and lows for the world’s biggest software company. Here are seven reasons why.

Microsoft's struggle to adapt to a computing market in which the PC is taking a back seat to tablets and smartphones is well known, and much of the company's troubles of late have arisen directly from that market shift. But don't count Redmond out just yet--it had some solid wins in 2011. There were also a number of clunkers. Here's a look at 7 of Microsoft's dumbest and smartest moves of the past year.

1. Skype buy (Smart). Microsoft announced in May that it had reached a deal to acquire Skype for $8.5 billion. Why was that smart? Skype's VoiP tools and services will add simple, widely-used video chat features to a whole host of Microsoft's products, including Office and Office 365, Windows Phone, and Xbox, and, in the future, Windows 8 tablets. That could give Microsoft a leg up on rivals like Google and Apple that, going forward, might even have to pay Redmond for the right to use Skype on some of their platforms.

2. Still no tablets (Dumb). If the current holiday shopping season has proven anything, it's that 2011 is the year of the tablet. Market data shows that the hottest gifts under the tree this year will be touch-powered slates from the likes of Apple, Android OEMs, and Amazon and its Kindle Fire. As for Microsoft? It's still talking about tablets in the future tense. The company's tablet strategy is closely linked to the touch-friendly Windows 8, which may not see daylight until late next year or even until 2013. By then it may be too late to the party.

3. Kinect for Windows (Smart). With PCs taking a backseat to tablets and smartphones, Microsoft needs to find a way to reinvigorate its core Windows franchise. It may have just the thing in tools that will allow developers to port Kinect apps from the Xbox to the PC. Kinect on Windows machines promises a number of new applications, from entertainment to manufacturing to healthcare. Some developers at the University of Washington are already using the technology to create systems that will allow physicians to operate miniaturized surgical equipment through hand gestures.

4. Killed Zune (Smart and Dumb). Microsoft officially put its long suffering Zune franchise out of its misery in October. That was smart because Zune had become an also ran in the MP3 music player category, and as a brand did not fit with Microsoft's new mobile strategy, which is based around Windows Phone 7. The dumb part? That it took so long--Zune has been on life support for years and should have been scrapped long ago.

5. Office 365 launch (Smart). With cities like Los Angeles and Washington, D.C. moving their desktops to Google Apps, Microsoft needed to respond to its rival's cloud-based offerings. It did so with Office 365, which launched in June. Office 365 features cloud-based versions of familiar Microsoft productivity and communications tools. It includes access to Office Professional Plus, Exchange Online, SharePoint Online, Lync Online, and Office Web Apps.

Plans start at $6 per user, per month, making the offering competitive with Google's Google Apps service, which includes online email, productivity apps, and calendaring starting at $5 per user, per month. Key Office 365 customer wins to date include Hendrick Automotive Group.

6. Billions To Nokia (Dumb). Microsoft and Nokia earlier this year struck a deal under which the Finnish handset maker will ditch Symbian and use Windows Phone as the default OS on virtually all its mobile devices. On the surface, it's a good deal for Microsoft, given that Nokia still ships more phones worldwide than any other manufacturer. But it turns out that Microsoft will actually pay Nokia billions of dollars to use Windows Phone. Don't OEMs usually pay for the right to use software, not the other way around?

7. SUSE Linux deal (Smart). Microsoft in July announced that it would extend an agreement under which it purchases "certificates" for SUSE Linux support and services and resells them at a markup to Windows customers that operate in hybrid environments. Microsoft, which claims Linux violates its patents, also pledges not to sue certificate holders for infringement. The arrangement allows the company to profit from its claims on Linux without angering customers.

Any other Microsoft moves, dumb or smart, that caught your eye this past year? Post a comment or drop me a line.

According to our Outlook 2012 Survey, IT should expect soaring demand but cautious hiring as companies use technology to try to get closer to customers. Also in the new, all-digital issue of InformationWeek: Inside Windows Server 8. (Free registration required.)

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Guest
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Guest,
User Rank: Apprentice
12/29/2011 | 12:43:36 AM
re: Microsoft's Dumbest And Smartest Moves Of 2011
How about them? They are all ostracized in the tech world and only exist because MS keeps dumping Windows money into them. They are not even taught in any real computer science or IS program because .NET is a MS copy of Java and it a vendor proprietary framework. When Windows starts to slide, people will wish they would have kept their options open. Yes, nearly every company runs MS SQL (I hate it when MS calls it "SQL Server" as both DB2 and Oracle are SQL based and IBM invented SQL) and MS Server, but not for mission critical. They section off the Wintel environment from the enterprise gear.
Guest
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Guest,
User Rank: Apprentice
12/29/2011 | 12:26:56 AM
re: Microsoft's Dumbest And Smartest Moves Of 2011
Silverlight is an obscure, proprietary technology which is only backed by Microsoft. Very much like Flash which MS was trying to copy with Silverlight. It is just stuff which is designed to get people to use flimsy MS Server instead of Linux/Unix and open languages. Developing on .NET now would be a mistake as you are totally dependent on MS's roadmap and viability. If you develop on an open standard, you don't have to deal with MS's whims and worry about it still being around in 5 years if the Windows dominance goes away.

Exchange tight controls... in what world. Lotus has much better security controls than Exchange. It is also able to run on an enterprise grade platform, Linux, Unix, etc, instead of Wintel or Wintel. If it is hard to maintain for a small organization (which it is designed for), think about setting up DAGS for a 100,000 user system. Lets say what is obvious, the only reason people use Exchange is for the MS Windows/Office look and feel, which isn't as important as it was a few years ago. It has zero to do with technology superiority and it certainly isn't to do with business value as it is the most expensive e-mail suite on the market (e-mail being a pretty standardized, "you have seen one, you have seen them all" service).

I agree that Oracle, DB2 and MS SQL are not designed to handle unstructured data. You are correct on that point, but that isn't the reason people use Oracle or DB2 (primarily Oracle) for mission critical and MS SQL for MS workgroup applications. In MS SQL, the DBA doesn't have any control over memory usage or caching. All of the blocks are 8k in MS SQL, which is no good if you have large objects. No partitioning, no clustering, no bit map indexes, etc.... It is just not in the same functional class as Oracle or DB2. Microsoft and Sybase developed SQL together. After they split, Sybase tried, and basically failed, to create an enterprise database. MS went the other way and tried to create a workgroup DB which is easy to administer. Sure, every large company has some MS SQL servers, but they are not running mission critical transactional systems (SAP, for instance).

Guest
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Guest,
User Rank: Apprentice
12/29/2011 | 12:01:09 AM
re: Microsoft's Dumbest And Smartest Moves Of 2011
I agree that it is doubtful buying their way into the mobile market will work. All of Microsoft, or at least everything that makes a profit, is tied to their dominance with Windows (Office, .NET, MS Server, Exchange, etc). All of those businesses will do as well or as poorly as Windows. They need to make Windows the dominant client OS to continue to hold up the rest of their proprietary products.

I don't underestimate Microsoft. They have an enormous amount of influence and cash. The known world standardized on Java and related technologies. Microsoft said "nope, we're going to do .NET so deal with it world." Amazingly it sort of worked. Microsoft is not going to be irrelevant overnight, but they are now chasing the market and trying to squeeze it back into their Windows centric world. I doubt they are going to be able to convince everyone it is Windows or nothing on mobile and tablets as they did with PCs. If they have Windows dominance, Office, Exchange, Server, etc just falls in line because of the integration. A Windows centric world is just not in anyone's interest anymore, consumers or the rest of the IT industry. I think they will be as profitable as ever next year and the year after, but it is sliding away from them.
Woland
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Woland,
User Rank: Apprentice
12/28/2011 | 7:57:26 PM
re: Microsoft's Dumbest And Smartest Moves Of 2011
You are getting your information from the headlines.
Silverlight is not dropped and it is much superior than html5 + script. It will be still used in a lot of business apps. .net is not replaced in windows 8, windows 8 actually uses silvelight/wpf xaml technology and .net. The runtime is not built using .net but can for sure be called by .net, just like in windows before.
Exchange is old and fits in organization with tight controls, but yes it becomes to much maintenance when used in small organizations.
MS SQL is not designed to handle unstructured data (so is Oracle) and that is why Hardoop support was added in Azure
Zzz2002
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Zzz2002,
User Rank: Apprentice
12/28/2011 | 4:19:27 PM
re: Microsoft's Dumbest And Smartest Moves Of 2011
Silverlight is being dropped - HTML 5 took care of it!
.NET is being replaced in Windows 8 - a lot of developers are pissed because yet one more change.
A number of companies are dropping Exchange - they are getting rid of eMail as it a major time waster!
MS SQL is not really up to it when you get to really large data stores and it doesn't handle unstructured data very well - think Hardoop (sp?).
M$ is not down but it is certainly looking to its corner.
Woland
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Woland,
User Rank: Apprentice
12/28/2011 | 9:03:25 AM
re: Microsoft's Dumbest And Smartest Moves Of 2011
This is funny. How about .NET, Azure, WPF/Silverlight? And there are plenty of respectable companies that do run SQL Server, Windows Servers (AD).
ThePrisoner6
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ThePrisoner6,
User Rank: Apprentice
12/28/2011 | 4:43:48 AM
re: Microsoft's Dumbest And Smartest Moves Of 2011
I agree that Microsoft definitely has yet to prove itself as a viable contender in the mobile space. You can't just buy your way into the market and expect everyone else to bow out. still, the more choices we have as consumers is, I think, beneficial, as long as they offer something that we want. The onus is on Microsoft to prove themselves. Their deal with Nokia, apparently paying them to convert to WP7, is not without its risks, but they have taken similar steps before to garner market share. Offering Internet Explorer for free and embedding it into Windows is one example that comes to mind. For years they dominated the global browser market as a result. Windows Phone 7 may be a consumer flop, but with RIM in apparent decline and many of the existing mobile devices lacking secure, integrated, core MS Office functionality, this leaves an opening for Microsoft to swoop in with broad support for its flagship productivity suite and once again be the darling of the enterprise.

This may or may not happen in reality, but despite what you may think of Microsoft as a company, there are some really smart people working for them. There are still many fronts in the mobile and tablet industries that have yet to be won and lost. Microsoft is good at throwing their weight around, and to be sure, there is a target on their back, but you might be surprised at the outcome. Many have predicted Microsoft's demise, but so far, they have managed to surprise everyone with their resiliency.
Guest
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Guest,
User Rank: Apprentice
12/28/2011 | 4:00:42 AM
re: Microsoft's Dumbest And Smartest Moves Of 2011
No tablets? What about the HP Slate with Windows 7? At $800 per tablet, they must be selling literally dozens of them.
Guest
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Guest,
User Rank: Apprentice
12/28/2011 | 1:04:22 AM
re: Microsoft's Dumbest And Smartest Moves Of 2011
Agree, Silverlight is more comparable to Flash. A client side run-time for visual development. Javascript is just a client scripting language. All of the client side stuff is being replaced by server side scripting and tools. The only thing that will remain on the client side is presentation HTML when web apps/sites are being designed to run on a phone.

From a larger perspective, I think all of .NET does not have a rosy future. .NET was a Microsoft vs. the world framework. In direct opposition not only to open standards and open source, but to the rest of the IT industry (IBM, Oracle, Apple, SAP, etc). If Microsoft cannot subsidize .NET with their Windows and other cash cow businesses, no one is going to be jumping in to save it as everyone, primarily IBM and Oracle, jumped in to save Java after Sun could no longer support it.
Guest
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Guest,
User Rank: Apprentice
12/28/2011 | 12:42:52 AM
re: Microsoft's Dumbest And Smartest Moves Of 2011
I think that is the point. There is no smart move for Microsoft in tablets and mobile. The genie is out of the bottle and OEMs have figured out that they can make computers/phones without paying protection money to Microsoft for the privilege of using their OS. The Microsoft business model is in the rear view as the OEMs realize that even if they sell millions of MS devices, they are just doing all of the work and shipping all of the profit to MS. It is better for them to go the open source route or the proprietary route (Apple, RIM) where they at least have the possibility of not being in a completely commoditized, race to the bottom on price business.
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