Microsoft Cant Prosper Forever with On-Premises Software

By Don Reisinger  |  Posted 2010-06-08 Print this article Print


5. Be more than search

Bing currently stands at the center of Microsoft's Web strategy. Search is quickly becoming the key battleground on the Web, both from a market-share perspective and an advertising perspective. But that doesn't mean that it's the only thing that Microsoft can worry about. With any luck, Microsoft will be able to continue increasing its search market share, but also be able to satisfy customers looking for cloud solutions. It should also double down on its efforts with its Web-based Office suite. The Internet is about more than search. Microsoft must remember that.

6. Invest heavily in advertising

Advertising will eventually make or break Microsoft. Right now, Google is generating billions of dollars in revenue by virtue of its advertising efforts. And thanks to its recent acquisition of AdMob, it looks like the company will only increase its advertising revenue over the coming years. Microsoft isn't so lucky. The software company's advertising efforts are being dwarfed by Google's. And although it contends that it's working diligently to become a major advertising player, it's not close to achieving that goal. The future isn't so bright for Microsoft without a solid advertising platform.

7. Get into social networking

Social networking is an extremely important market. So far, Microsoft has dabbled in the space by investing some of its cash in Facebook for a small portion of ownership. But that's simply not enough. If Microsoft is to be successful on the Web, it needs to have a real social presence. That might mean that the company should acquire Facebook or Twitter outright. Admittedly, it would be an expensive proposition. But given the kind of revenue that Microsoft generates each quarter, it wouldn't be enough for investors to think twice. Social networking is integral to Microsoft's future Web performance. It can't forget that.

8. Accept that offline software will die

This one might come as a shock to Microsoft, but it's about time that it admits that offline software will eventually die. When that will happen is anyone's guess. It's entirely possible that the Web will provide a more robust experience than offline software in 10 years. If things don't go well, it could take 20 years. But in any case, offline software will eventually give way to the Internet. And when that happens, Microsoft must be prepared to capitalize on the changing market. Right now, it's not even close to being able to rely on the Internet for revenue growth. By accepting that offline software will eventually die, Microsoft can set its sights on the future. Until then, it will continue to focus too much of its effort in the wrong market.

9. Start playing nice with other browsers

Although Internet Explorer is still a top browser, Microsoft needs to stop trying to destroy every other browser on the market. Yes, Internet Explorer was once integral to the company's business, but today its influence is waning. And with competition and government regulators making it clear that Internet Explorer is more trouble than it's worth, the company's browser is catching more heat than ever. Microsoft needs to start playing nice with the browser competition and work diligently to improve Internet Explorer's many flaws. After all, the browser is the gateway to the Web. If Web users aren't relying on Internet Explorer, they probably won't be using Microsoft's Web services.

10. Remember entertainment

As a company that has spent its entire history trying to be the functional, productive alternative to other solutions, it might be difficult for Microsoft to realize that a key component of the Web is entertainment. But unless the software company finds a way to capitalize on that, it will have a difficult time in the cloud. More Web users than ever are streaming music, playing videos and enhancing their Web experience by enjoying entertainment. So far, Microsoft has done little to satisfy their desire. Meanwhile, Google owns YouTube, the world's largest repository of entertainment. Microsoft obviously can't acquire YouTube, but it should find ways to offer entertainment to users. It really does matter to Web users.

Don Reisinger is a freelance technology columnist. He started writing about technology for Ziff-Davis' Since then, he has written extremely popular columns for, Computerworld, InformationWeek, and others. He has appeared numerous times on national television to share his expertise with viewers. You can follow his every move at

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