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Should Microsoft Play To Its Corporate Strengths?

With Apple recently experiencing explosive growth and Microsoft stock in the doldrums for most of the decade, it's time for some action in Redmond. Last time I proposed a "show them how it's done" model, where Microsoft builds complete solutions that include its software. This time it's the "focus on what you do best" approach; for Microsoft that means servers and business infrastructure.

I recently saw some data that drove this point home. The site VendorRate.com compiles ratings of software and hardware vendors, given by IT management and staff. A recent report (480 KB PDF) from them shows that Microsoft's server and infrastructure groups were given a rating of Exceptional by reviewers.

The Windows Server group has been heading in the right direction all decade long by optimizing and locking down their product. The latest in the line, Windows Server 2008, even offers a configuration with no graphical user interface at all--shades of Unix! This is the kind of product development that isn't sexy and doesn't make headlines in the Wall Street Journal, but it makes customers happy. Happy customers tend to keep using your products and services.

At the opposite end of the spectrum is Microsoft's Windows Client group. VendorRate.com reviews puts them near the bottom in customer satisfaction with a rating of Poor. Maybe IT professionals just can't be expected to like a client OS, because of the hassles that come with it. Microsoft's disastrous launch of Vista didn't help matters; XP is still king in corporate America. Just recently, HP spilled the beans and confirmed what everyone suspected: corporate customers are buying Vista licenses but still using XP.

The most visible features of Windows Vista were aimed at attracting consumers and retail sales, not at satisfying the needs of corporate America. You can't blame Microsoft, because all IT wants is dull and boring things like reliability, stability, and manageability. How can you make an exciting commercial about things like that? Yet now Microsoft is suffering the results of ignoring those boring IT needs, because Vista is still not offering IT anything that they see as worth the upgrade.

As the situation with Vista shows, it is difficult for Microsoft to focus its development efforts on two different audiences -- that's not focusing at all. Microsoft needs to give companies what they want in a client OS, even if it's boring. Companies like Oracle and SAP always have stayed focused on corporations. Others, like IBM, used to play in the consumer market, but have gone back to their corporate-customer roots. Who knows, maybe we can look forward to inane Microsoft ads about "ideating". Most companies would probably settle for a Windows 7 that looked like Microsoft designed it with their needs in mind.

Realistically, though, I doubt Microsoft will give up on consumers. They want to have it all -- to own the market for software inside corporations, small businesses, homes, phones, cars, game consoles, or maybe even on other planets. This is, after all, the company whose vision Bill Gates described as "A computer on every desk and in every home, running Microsoft software." Microsoft's corporate psyche can't take the stress of abandoning that vision, at least not yet.

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