My list of technology companies that I love to bash has grown through the years. Microsoft, Google, Samsung, Amazon. All were up, now they’re down. Well, guess what? Microsoft is back, baby. Uh, um, anyway; that’s what the folks at Microsoft are saying these days. The jury is still out but there’s a growing chance that the latest Microsoft strategy might be working.
Strategy? Microsoft has a strategy?
I mean, you know, something besides throwing money against the wall on an untold number of failed acquisitions and projects which have drained the company’s once mighty coffers of gold.
It used to be Windows and Office on desktop and notebooks, but Microsoft more or less missed the entire mobile device revolution (except for extracting a few billion dollars a year in patent royalties from Android device makers), but once former CEO Steve Ballmer was kicked out the door, the company began a long overdue pivot; a 180 back to the future by doing what Microsoft did back in the day.
Microsoft Office for Mac 2016 gets rave reviews. Even from Apple folk. Check Apple’s App Stores and you’ll find a long list of Microsoft applications. OneNote, OneDrive, Remote Desktop. For iOS devices there’s Word, Excel, PowerPoint, and Outlook, too. And they’re free.
Microsoft thinks a subscription cloud service is the future and makes software available for Windows, Android devices, the Mac, iPhone, and iPad; most of it free as an enticement to use Office 365 and pay by the month for additional features and online storage.
Businesses love monthly subscriptions because they’re easy to budget. What about the rest of us? Adobe has had success with Creative Cloud which is a monthly rental service for one or many or all of the company’s stellar graphic and web design apps.
Microsoft has had success with Surface Pro 3, too; garnering good reviews for a hybrid tablet notebook that’s more of a notebook with a detachable keyboard, but it’s easily differentiated from Apple’s iPad and Mac.
Windows and Office are not going away anytime soon, and still account for most of the company’s profits (much like Google’s advertising engine makes up the lion’s share of the search giant’s profits), but this strategy seems more focused than the old strategy of relying on Windows and Office while buying companies that are losing money (cough… Skype… cough).
Take a look at Office for the Mac and you can see why Microsoft thinks the subscription model makes sense. I used to buy the personal edition of Office for Mac every couple of years for about $120. An Office 365 subscription is about $10 a month; double the money, and because it’s a subscription, you have to keep paying.
Put another way, Microsoft’s strategy of hooking customers on free apps tied to a monthly subscription that runs forever might just work. If it were not for Google and Apple making similar products for free.