#Microsoft

Ina Fried:

Indeed, Microsoft does offer Office 365 subscriptions within the just-released Word for iPad and the other Office apps and, yes, it is paying the 30 percent cut, Apple confirmed to Re/code. Microsoft declined to comment on the matter.

Microsoft is giving Apple a 30 percent cut on sales of Office 365 through the iPad apps. Let that sink in for a minute. And then realize that both sides are probably going to make a ton of money as a result.

Satya Nadella:

A great idea shouldn’t have to wait for you to get back to a particular device. An impromptu call with a customer shouldn’t be delayed because you don’t have the right data on hand. Life moves too fast to put limits on where and how you work. Just as the best camera is the one you have with you, sometimes the right device is the one closest at hand. Simply put, our vision is to deliver the best cloud-connected experience on every device.

A few buzzwords aside, this is a great post. Clear and fairly concise. It seems like he gets it.

52 Days

A few tweets of mine today about Microsoft releasing Office for iPad seem to have people up-in-arms. So allow me to clarify.

First, I do think this is an important moment. Not for me, personally, because I still won’t use Office — haven’t in years — but for millions of other people who do and want to use it on their own terms, on their own devices. More importantly, this is important for Microsoft. It’s a grand gesture to suggest they’re finally taking their head out of the sand it has been in for the better part of a decade.

"But, but, but, Microsoft clearly didn’t make Office in 52 days!," they whine. No shit. I’m not saying that Satya Nadella has been the one man hand-coding Office for iPad with both hands tied behind his back for the past 52 days. I’m saying it takes balls for Microsoft to even release Office for iPad at all. Especially now.

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Charles Cooper and Seth Rosenblatt:

Microsoft went through a blogger’s private Hotmail account in order to trace the identity of a source who allegedly leaked trade secrets.

Technically legal or not, this is absolutely insane. And awkward — here’s the copy from Microsoft’s "Scroogled" Gmail campaign:

Outlook.com is different—we don’t go through your email to sell ads.

Nope, we just go through it to get information we need to use in lawsuits. You literally cannot make this up.

And if users needed even more reasons to ditch Hotmail today — beyond the fact that it’s 2014 — Google has a nearly opposite announcement today:

Starting today, Gmail will always use an encrypted HTTPS connection when you check or send email. Gmail has supported HTTPS since the day it launched, and in 2010 we made HTTPS the default. Today’s change means that no one can listen in on your messages as they go back and forth between you and Gmail’s servers—no matter if you’re using public WiFi or logging in from your computer, phone or tablet.

In addition, every single email message you send or receive—100 percent of them—is encrypted while moving internally. This ensures that your messages are safe not only when they move between you and Gmail’s servers, but also as they move between Google’s data centers—something we made a top priority after last summer’s revelations.

Where’s Mark Penn when you need him?

Yiren Lu:

On the other hand, the continued success of companies like Apple, which are old guard yet somehow don’t seem out of date, implies that there is still another force at work. It is possible, albeit difficult, for a large, established company to stay relevant — but it requires recognition that to a software engineer in his 20s, with endless opportunities, what matters most is not salary, or stability, or job security, but cool. Cool exists at the ineffable confluence of smart people, big money and compelling product. You can buy it, but only up to a point. For example, Microsoft, while perpetually cast as an industry dinosaur, is in fact in very good financial shape. Starting salaries are competitive with those at Google and Facebook; top talent is promoted rapidly. Last year, every Microsoft intern was given a Surface tablet; in July, they were flown to Seattle for an all-expenses-paid week whose activities included a concert headlined by Macklemore and deadmau5.

Despite these efforts, Microsoft’s cool feels coerced. One reason might be its sheer size — with a market cap of $315 billion, Microsoft will never enjoy the headlong rush of a company with nothing to lose, the bite of the underdog. But I think a more important reason is that so many of its products came up short for so long that its offerings now, however well packaged, are greeted with skepticism. About two years ago, I started noticing an advertisement for Microsoft’s Internet Explorer 9 on YouTube. Internet Explorer was the dominant web browser for nearly a decade and is still used by about a fifth of all Internet goers, according to StatCounter, but it has fallen out of favor with the tech savvy. Many websites are not compatible with Internet Explorer; its development tools are thin compared with those of Chrome and Firefox. The commercial, however, was excellent — sleek and sophisticated and featuring a dubstep remix of “Too Close” by Alex Clare; I distinctly remember watching it through to the end, watching it again and then thinking, That commercial almost made me want to use Internet Explorer. Of course, I never did switch to Internet Explorer.

Great advertising mixed with a great product, works. Great advertising mixed with a shitty product is a waste of money.

Natasha Lomas on how the numbers are shaping up so far in the gaming console space:

The thing is neither of these new generation console flagships is selling very well when compared with previous generations of flagship consoles. The console market appears to be shrinking significantly — and that’s evidently having a knock-on impact on games studios and game development.

At this relatively early stage the new generation stacks up as follows: Wii U at 6 million, XB1 at ~4 million and PS4 at 6 million: a total of ~16 million. So only around 244 million to go — just to perform as well as the last generation. But with game budgets increasing a flat console market isn’t a good thing. This new generation needs to be outselling the last, not looking like it’s going to have a really tough time shipping the same.

I hate to say “I told you so” …but, well, I did.

Lots of good nuggets from Dina Bass, Beth Jinks and Peter Burrows on the end of the Steve Ballmer tenure at Microsoft:

Several directors and co-founder and then-Chairman Bill Gates — Ballmer’s longtime friend and advocate — initially balked at the move into making smartphones, according to people familiar with the situation. So, at first, did Nadella, signaling his position in a straw poll to gauge executives’ reaction to the deal. Nadella later changed his mind.

Strike 1. And in other words, Nadella was against it before he was for it. We’ll see how that ends up playing out now that he’s the man…

Ballmer was so loud that day in June his shouts could be heard outside the conference room, people with knowledge of the matter said. He’d just been told the board didn’t back his plan to acquire two Nokia units, according to people with knowledge of the meeting. He later got most of what he wanted, with the board signing off on a $7.2 billion purchase of Nokia’s mobile-phone business, but by then the damage was done.

Strike 2. But:

The tablet Microsoft finally came out with in October 2012, the Surface, was a dud. Windows 8, with a touch-based design, was released to mixed reviews. The smartphone operating system, Windows Phone, wasn’t a hit either — but Ballmer remained committed to it. A deadline was looming that would result in one of his last rolls of the dice.

Nokia made about 80 percent of handsets using Windows Phone, and the arrangement was set to expire in February 2014. Nokia had been dropping hints it might start making devices to run on Google’s Android platform. Ballmer needed a way to keep Nokia in Microsoft’s world.

Hard to see what other choice Ballmer had. Without Nokia, Windows Phone was effectively finished. Instead, Ballmer was. He struck out.

One more thing:

As Microsoft continued to lag behind rivals, some directors grew more unhappy. Ballmer had introduced Mulally as part of the company’s succession planning, and those on the board looking for ways to move Ballmer out talked in July about hiring the Ford CEO as a way to persuade the CEO to step down. In August, Ballmer, 57, announced he would retire, earlier than planned.

Interesting that it was Ballmer who ushered Mulally into the Microsoft mix, effectively sealing his fate…

Dina Bass:

Microsoft’s Corp.’s newly appointed Chief Executive Officer Satya Nadella, in an effort to reignite growth, is shuffling management and putting former political operative Mark Penn in the new role of chief strategy officer, according to people with knowledge of the matter.

Nadella’s mistake number one: not firing this joker.1

Here’s Nadella’s memo confirming this move and the rest of the shakeups on the executive team. And here’s more on Penn within Microsoft.


  1. Though his new role isn’t necessarily a promotion — it’s a shame he’s sticking around at all. 

No, I don’t think so.

Microsoft’s UK marketing director Harvey Eagle, talking to Metro about the Xbox One price cut in the UK. The question asked if the price cut — just 94 days after launch — was an admission that the console isn’t selling well.

Eagle doesn’t think so. But he’s not sure. Why should he be sure? It’s only his job.

Meanwhile, while Microsoft has maintained that the Xbox One is selling as fast as the system can be made, Eagle told GameSpot: “We’re doing this because it will generate sales, absolutely.”

So, Microsoft isn’t cutting the price because it hasn’t been selling well in the UK. In fact, it has been selling as fast as possible. But this price cut is all about helping to generate more sales. Got it.

Business as usual.

Emil Protalinski:

Windows 7 launched on October 22, 2009. In October 2010, Microsoft revealed that it had sold over 240 million Windows 7 licenses in the operating system’s first year, and in January 2011 that number grew to 300 million at the 15-month mark.

Windows 8 launched on October 26, 2012. In February 2014, Microsoft revealed that it had sold over 200 million Windows 8 licenses in the operating system’s 15 months. No matter how you slice it, that’s not good news for the company.

No, it’s not.