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Microsoft could be the "Comeback Kid" in 2012

Microsoft has made some decisions in 2011 that have the potential to pay off nicely, if the company can keep its focus and deliver on its promises.

As we come to the end of 2011, those of us in the U.S. can't help but notice that 2012 is an election year, when we'll be going to the polls to decide who will lead our country for the next four years. But it's not just in the arena of national politics that the populace will be making important decisions.

Thomas Mann said "Everything is politics," and in the world of technology, we vote with our wallets. Just as only one person can be president at a given time, only one company can be at the top of the tech heap (well, theoretically). Two companies could have exactly the same market cap, net profits, total revenues, cash-on-hand, or whatever measure you use to compare the value of entities within the industry.

Microsoft was long valued as the top technology company, until Apple unseated it in the spring of 2010. But the public is a fickle beast -- just ask all the politicians who have lost the race after running at the top of the polls. Being the current incumbent doesn't guarantee anything; remember Jimmy Carter? And just because you lost once, it doesn't mean you won't bounce back, as Bill Clinton (or, for that matter, Richard Nixon) would attest.

Technology is always changing, and today's must-have, oh-so-cool gadget or device can quickly become yesterday's news. Are there signs that the shine is wearing off the nicely polished Apple? And if that is true, will Microsoft seize the window of opportunity to stage its own transformation into tomorrow's "comeback kid"?

Is Apple losing its cool?

I can't claim credit for originating the question; the New York Times was asking it as far back as May 2010, even as Apple was being crowned the King of Market Cap. Since then, the iPad has taken off with many millions of sales and the iPhone has continued to show strong sales figures, although on the desktop, Macs still hold single digit percentages of market share against Windows' 86 percent. But some say the desktop is all but dead and the future of computing is in tablets and smart phones.

While I don't agree that desktops and full-featured laptops are going to disappear anytime soon, even if it's true, there are some indications that Apple's "walled garden" approach is being to wear thin with some of its customers.

Last April, Nielsen reported that its research showed Android, not iOS, to be the most desired smartphone operating system. Then in August, the iPhone lost its spot at the top of the smart phone mountain when sales of Android devices surpassed those of the iPhone, and just last week, the number of daily active users of Facebook on Android went past the number of Facebook users of the iPhone app.

One could look at those figures and ask why that's good news for Microsoft. After all, it's the competition from Google that seems to be cutting into Apple's market shares. But, aside from the fact that Microsoft makes money every time an Android device is sold (as I discussed last week in my "patent wars" article), the defection of some of Apple's fan base to Android also suggests that there are customers looking for alternatives to the iDevices -- and that's an opportunity for Microsoft to pick up at least some of those customers.

A series of bad decisions?

Microsoft made a number of decisions in the last decade (mainly 2005-2010) that were seen by many as blunders: the release and then almost immediate discontinuation of the ill-fated Kin, the killing of the eagerly anticipated Courier tablet, the Seinfeld ad campaign, the failed acquisition of Yahoo, and more. Perhaps the biggest of all was the release of Vista, which garnered the scorn of many previously loyal Windows users and gave Apple the ammunition for its relentless barrage of Mac Guy/PC Guy commercials ridiculing the unfortunate OS.

What Microsoft did right in 2011

What hasn't gotten quite as much attention, perhaps, is the fact that Microsoft has made some decisions in 2011 that have the potential to pay off nicely. The acquisition of Skype earlier this year is timed right -- at a period when many are abandoning their landlines and dissatisfied with their cell phone carriers. The time is ripe for an explosion in Internet-based calling, and Skype is already one of the most popular applications for that. If Microsoft integrates it seamlessly into Windows 8 and manages to get it onto the Windows phones as an alternative to using expensive cellular minutes, it could be a fantastic feather in the company's cap.

Kinect was launched near the end of 2010 and has been a big success for the company in 2011. Microsoft's decision to take it, and the Xbox, beyond gaming and make it the basis of their "next generation of TV entertainment" puts Microsoft in a very strong position against products like Google TV and Apple TV that were introduced with much hype and hullabaloo but haven't sold very well.

After creating a solid operating system in Windows 7 that has convinced even many XP die-hards to upgrade, Microsoft is taking a huge gamble on Windows 8. The decision to release a developer preview a few months ago opened the company up to much criticism about the completely overhauled GUI. But given the rising popularity of tablets in the consumer space, building a new interface that's truly touch-friendly (and not just a "touchable" version of the old familiar desktop) wasn't only the right decision, but it was the only logical decision.

What the people want -- and don't

What we want in our leaders -- whether they're political figures or companies -- is the ability to think big, to exude confidence, and to take control. In other words, we want them to act like leaders, to get out there and lead. That's what Apple has been doing for the past several years. And it's not just about the products.

Steve Jobs's arrogance is infamous, but it's also a common characteristic in a strong leader. He -- and by extension, Apple -- never showed a hint of uncertainty or self-doubt. He dared to use words such as "magical" and "revolutionary" to describe his products, and he did it with an absolute conviction that made people believe it was true. Old-time comedian George Burns said "Sincerity -- if you fake that, you've got it made." Jobs was either truly sincere in his belief that Apple was the best, or he was a master at faking it.

Once upon a time, Microsoft exhibited the same kind of arrogant self-assurance, but then it lost that attitude. Perhaps all those battles with various governments, all those mocking commercials from Apple, all that hatred pouring from the Microsoft-bashers in the press beat the company down for a while and broke its spirit. Microsoft started to come off as uncertain, wish-washy, and thus undependable.

The PC Guy started to look like that desperate kid in high school who wants everybody to like him and keeps trying on different personas that never work. Rushing products to market and then dropping them like hot potatoes didn't make the company look like a leader; it made Microsoft look unfocused and unsure. It didn't come across as a deliberate strategy (like Google's "come up with a bunch of ideas and throw them against the wall to see what sticks" model), but more like a flip-flopping politician who changes his position on the issues every time there's a shift in the polls.

What's ahead in 2012

That was then and this is now. In the past year, Microsoft seems to have found its footing again. The strong sales of Windows 7 and Xbox/Kinect seem to have gone a long way toward resolving its self-esteem problem. The mostly positive reception for Windows Phone -- despite less than glowing sales -- and the flush of anticipation for Windows 8 tablets seem to have given it back some of its old fighting spirit. The company just might be ready to step up and be the leader we're looking for in a post-iPad world. The big question, then, is whether the company will continue to rally in the coming year, or will it fall back into the same sort of stop/start, uncertain, faltering lockstep in which it has seemed to be stuck for a few years.

If we look at the political arena, individuals who make dramatic comebacks usually do so either because they make fundamental changes in themselves or because there is a fundamental change in the voting populace (sometimes both). Microsoft can't control its "voting" public, so it has to look to making internal changes. And there have been plenty of those recently. Political analysts say that in order for a political party to come back from defeat, it must find a way to embody new ideas and/or repackage the old ones. And that's what Microsoft must do in order to earn the title of "Comeback Kid" in 2012.

Also read:

About

Debra Littlejohn Shinder, MCSE, MVP is a technology consultant, trainer, and writer who has authored a number of books on computer operating systems, networking, and security. Deb is a tech editor, developmental editor, and contributor to over 20 add...

28 comments
jack_stockton
jack_stockton

Microsoft has had tables for years, but could never get people to pay the extra cost. Apple comes out and says we need tables and the sheep say yes "I must buy". I keep waiting for the lawsuits for health problems from the iPhones, iTables and their clones. Every computer user knows about all the problems; eye strain from small screens, neck problems from looking at the screen at the wrong height and of course carpal tunnel from typing?

oldbaritone
oldbaritone

With Jobs gone, Apple's slide back to #2 would be predictable. "The acquisition of Skype earlier this year is timed right ??? at a period when many are abandoning their landlines and dissatisfied with their cell phone carriers. The time is ripe for an explosion in Internet-based calling..." You're kidding, right? This is "Old News", 5 to 10 years out of date. "Abandoning their landlines" happened years ago. It might be a slice of market share that helps MS nudge Apple out of the top spot, but it's "catch-up" not progress. And it's convenient that you completely ignore the 2011 debacles of Windows-8. "Comeback Kid"? Maybe. But I think it's more likely by default than by determination or dedication.

SmartAceW0LF
SmartAceW0LF like.author.displayName 1 Like

several fundamental cornerstones in the plan are glaringly absent. Case in point... Who really cares what MS is doing with a smartphone? Has the third party application development and its successful integration into the iphone and android phones been completely missed by the brains at MS? So they are building a new tablet-centric OS. Apparently, this is some bold and adventurous light-bulb-flash thought with the MS people? Again, poll the ipad purchasers as to what in fact inspired or finally weighted their decision toward making their purchase of the apple vision of a tablet. Its my bet that the 3rd party apps, their creativity, cost and abundant variety weighed heavy on their decision to fork out the money for their ipads. Honestly, how can this get by MS?

Mooreman
Mooreman like.author.displayName like.author.displayName 2 Like

I have spent the better part of my holiday time-off repairing Windows XP and Windows 7 PCs infected with the Antivirus 2012/TDSS rootkit malware, for my customers, friends and relatives. As the virus writers adjust to the increased security offered by Windows 7, it's starting to crash just as often as XP does. The PC is an old, tired hardware/software system that IBM developed over 30 years ago. Its had a long successful run, but now it needs to be retired. Steve Balmer also needs to be retired. MS needs to hire some fresh blood and do a total rewrite of Windows NT, from the first byte on up. I figure just on my own PC, that I probably waste 50% of my productive computing time constantly applying an endless stream of security updates and fixing the constant minor, but annoying problems that Windows seems to be plagued with and now constantly updating secondary programs that act as virus magnets. Frankly I am sick and tired of it. I have better things to do with my time. Windows 8 just looks like another repeat of Vista. Trying to force a bloated desktop OS on to a smart phone is just plain insane! They are two different distinct markets. Windows 8 at the prices/margins MS is used to getting, won't stand a chance on smart phones. Apple practically gives iOS away for free on their iPhones. The profit is in the hardware. Same goes for Google Android. Windows 7 has to be the most over-rated OS on the planet. It has lousy backwards compatibility with Windows XP peer-peer networking. Does not communicate well with Linux SAMBA boxes. The Explorer file manager gets worse with each new release. No longer indicates network shares. They took out the sight lines. Thank G-d for after-market programs Explorer++. Network file transfers are slower under Win7 than WinXP. Win7 64-bit won't install from an IDE DVD drive, because MS left out the 16-64-bit CD-ROM.SYS driver. Any idea how many 64-bit boxes still have that setup? That issue was found in the betas of Win7, but MS never bothered to fix it. The solution turns out to be simple, use a USB drive, but It's stupid stuff like this that drives me up the wall with MS operating systems. It's no wonder Apple and now Google are walking all over the PC-guy. Whoops got to go, another Adobe Flash update needs to be installed. . .

techrepublic
techrepublic

My problem with Microsoft is that I just can't trust them anymore. First, 10 years of VB expertise made redundant. Then the same with Silverlight. Now Windows itself? It takes a long time to become good at something. It takes a really long time to become really good at something. I used to be really good. Now I'm average and just can't get enthusiastic about putting in the long hours it takes to master something which I know will be made redundant by a political decision at Redmond. I see Windows 8 as another Vista so I have no enthusiasm for that. I used to eagerly await the next release of MS technology, now I fear it. I know I am not alone. Thanks MS, its was fun - but not anymore.

trashmail
trashmail like.author.displayName 1 Like

The challenge in hunting grouse is to know about where they are sitting before they jump up and fly off. Dogs are useful in this process. If you don't have one, you rely on your own senses, and they are primitive compared to the lowly dog. They are also unproductive. The grouse is flushed, flies off, and is gone BEFORE the hunter realizes he was standing right there, unaware. Two seconds isn't enough to react, position, aim, lead, discharge a shotgun. Likewise, the grouse has flown off, IMO, vis a vis Microsoft. They know they are in the woods, they are armed, but they have no dog. Where the grouse was is not relevant once it has flown off. I have no ax to grind with MS. Apple is simply in the flow right now. Luck, leadership, intent, whatever.... Apple has it, MS doesn't. I like Win7, but am only adopting it because I got a free computer and a free OS. I'm moving all my legacy stuff (engineering software and project files) to virtual hard drives, virtual machines, and the land of No Upgrades. I just spent a few grand on Apple stuff. I'll work through some adjustment headaches, adopt new paradigms, and won't look back. Won't be enticed back. Wanna talk about the year of something, perhaps talk about the year folks abandon MS for good, as I am doing after 25 years. This is a serious issue. I have a huge base of tools and experience under that number, and it's unavailable to both MS, and to the my personal contacts who count on my opinion and the examples I set. I'm not rosy about MS prospects and can see them in the Sony/Samsung/Nokia/RIM huddle more than in the Apple side in 5 years. ( I am long AAPL. )

mcagirouard
mcagirouard

Hi Folks! You might think Microsoft and Apple are in the business to help the corporate world but this is not totally helping some of us with third party broadcast automation and management applications who are struggling with platform incompatibility issues. I am not convince and do not think Windows 8 will be a fit for my environnement. I could see a fit for the tablet appliance same as Apple.

phasys303
phasys303 like.author.displayName like.author.displayName like.author.displayName 3 Like

These kind of articles are starting to look like directly sponsored from Microsoft itself. It wasn't very hard to guess who would be writing this "The year of Microsoft's comeback" article. I'm seriously considering to unsubscribe, this is pure rubbish.

deadlycreature
deadlycreature like.author.displayName 1 Like

Out of all the pro-Apple articles and constant non-stop bashing of MS, someone writes a positive article on MS and it's considered a marketing ruse? LOL! You obviously don't read many articles on here, so you may as well unsubscribe.

Travasaurus
Travasaurus like.author.displayName like.author.displayName like.author.displayName like.author.displayName 4 Like

Debbie is simply writing objectively from a non-Microsoft-hating/bashing point of view and expressing her professional opinion; you can take it or leave it but it's rather childish of you to throw a little temper-tantrum here simply because you happen to disagree with what she has to say. What makes your "informed" opinion any more valid than hers?

bruckner.devilliers
bruckner.devilliers like.author.displayName 1 Like

I am not emotionally attached to MS or Apple, but while MS takes 93 seconds (at best) to connect its synapses and play a stupid tune at startup as opposed to Apple's 1 second- it will always be my OS of least choice - regardless of what or whom MS buys/decisions it makes.

Johnnmartin
Johnnmartin

really Microsoft grow your ability in market through iphone as well as smart phone.

bhwong1
bhwong1 like.author.displayName 1 Like

Windows Phone is the ONLY smartphone that Skype do NOT run on. It NEVER manages to get it onto the Windows phones as an alternative. You can verify this at: http://www.skype.com/intl/en/get-skype/on-your-mobile/ In fact, Windows Phone is the ONLY smartphone that do NOT even sync with local Outlook as well. Turning Windows 8 user interface into a phone/tablet interface is a huge mistake. It restrict multi-tasking of multiple windows.

BALTHOR
BALTHOR like.author.displayName like.author.displayName 2 Like

Got to go.The EULA police are here.

frankqrjobs
frankqrjobs like.author.displayName 1 Like

I think Microsoft is also doing well in the business environment. MS is consolidating and expanding its presence in the enterprise market. SQL Server 2012 is expected to be released in the first quarter of 2012. With the performance problems of Oracle as a company and the rising of SQL Server as an enterprise database plus Business Intelligence Development Studio as a Swiss army knife for business intelligence, MS is cementing its presence in the business arena.

phil_swift
phil_swift like.author.displayName 1 Like

'Apple???s ???walled garden??? approach is [s]being[/s] to wear thin with some of its customers' is wrong. All this Tech and no spell checker checker. Terrible.

bill_weimer
bill_weimer

The word "being" was spelled correctly. What was spellchecker suppose to pick up on. A good old-fashioned proof-reader, however; should have caught it!!

PensivePeter
PensivePeter like.author.displayName like.author.displayName like.author.displayName 3 Like

That would be "Apple's walled garden" not "Apples walled garden" ;-)

open_source_user_01
open_source_user_01 like.author.displayName like.author.displayName like.author.displayName 3 Like

MS has failed to realize the fact, virtualization is going to take the golden cow of requiring a 'Windows OS' out of the picture. When people finally realize, apps can be separated from a virus prone OS and run on another platform the MS empire will have to redesign their concepts. VMware host servers are now a tiny footprint compared to the esx host OS. Google Chrome netbooks have 1.6 million lines of code, Linux distro's can fit on a ISO image and run from disk and Windows is 50-60 MILLION lines of code full of who knows what. END users can run a Linux distro who have NEVER used a computer and they do not have problems. I set my mom up about 8 years ago with Red Hat 8.0 (I think it was 8.) and she did stuff on it I never would have dreamed she figured out. Linux distro's do not run as administrator, do not need hundreds of dollars worth of AV and spyware utilities, mega-bucks MS Office. The flow of money required for a Windows shop or even for grandma's is just STUPID. We eradicated Windows desktop OSes as much as possible, the problems dropped dramatically and the MONEY savings is HUGE. End users do not need MS Office to create a (.doc) and/or (.xls) files. It is a HUGE waste of money and money going down a rat hole. The MONEY SAVED is put in infrastructure, network routers/switches/blade_centers/sans and hire NON-Windows Systems people and implement a secure Open_Systems design that can withstand the public Internet without having mega-buck hardware firewalls to hide behind. No thanks, they can rehash Windows NT until oblivion it is still a REBOOT, REBOOT and problem plagued platform and the desktop will always be a nightmare as well.

BALTHOR
BALTHOR like.author.displayName 1 Like

I think that you could measure the voltage across those phone lines and come up with zero every time!Do you really think that the phone company gets two wires from everybody in your city?

AnsuGisalas
AnsuGisalas

and that's why, every time the net number of households+businesses in the city grows (to a number n), they have to run 2*(n-1) wires, all over town! No wonder they can't make a profit with wired in telephony :p

BALTHOR
BALTHOR

How do you think they would test the Internet?

seanferd
seanferd like.author.displayName like.author.displayName like.author.displayName 3 Like

What does it mean to most people if Microsoft makes a "comeback"? Or that Apple is currently a market cap leader? It is a good thing that there isn't just one [i]way[/i] above all others any longer.

AnsuGisalas
AnsuGisalas like.author.displayName like.author.displayName like.author.displayName 3 Like

Three ways for the tablet-kings under the cloud, Seven for the thumb-lords in their halls of phone, Nine for *Nix-Men doomed to fork, One for the Dark Lord on his dark throne In the Land of Mon'ply where the Shadows lie. One Way to rule them all, One Way to find them, One Way to bring them all and in the darkness bind them.

rhonin
rhonin

Tablets: Good chance if it can itegrate into business with typical MS software - ARM support for MSOffice is a must Smartphones: Kinda doubt it. They need to drop the MS moniker and replace it with something that doesn't scream "WINDOWS" to really have a chance. Just MHO.....

bkindle
bkindle like.author.displayName 1 Like

I tried the developer release on a test PC, and absolutely hated the setup. Now if it were only on a touch device then I am OK with it, and would probably use it. But they are going to need to build on the Win7 platform a little more before I will think about using it on a normal PC. I am one of those XP holdouts that converted to 7 not all that long ago.

Mark W. Kaelin
Mark W. Kaelin

Do you think Microsoft will grow market share in the tablet and phone markets in 2012?