Microsofts Missteps Exacerbate the Multiple Market Changes It Faces

By Don Reisinger  |  Posted 2011-12-29 Print this article Print


5. An odd Nokia partnership

As mentioned, Microsoft's Nokia deal was poorly conceived and could hurt the company in the long run. According to reports, Microsoft dropped a huge sum of cash just to secure its deal with Nokia. Combine that with the fact that Nokia's market share has plummeted and fewer people around the globe even want its products, and it's clear to see that the deal might not have been in the software company's best interests.

6. Failing to wrap up the living room

With the Xbox 360 and Microsoft Kinect, it would appear that the software giant truly understands what it takes to entertain people in the living room. However, at no point did Redmond find a way to corner the living room this year. Now, there are hints that Apple will be launching a television next year that will come with a host of integrated services. This development may significantly limit Microsoft's growth opportunities in the living-room-entertainment market during 2012.

7. Retaining Steve Ballmer as CEO

Steve Ballmer has been running Microsoft for a long time. But he hasn't made the insightful decisions that would have allowed the company to regain its former robust growth pace. This calls into question whether he should remain Microsoft's top decision maker. Over the last 10 years, Microsoft's stock price has dropped, its financials aren't as strong as they should be and its position across the industry has been marginalized. Add that to Microsoft's mobile troubles, and it quickly becomes clear that Ballmer might not be the best person for the CEO job. Unfortunately for Microsoft, in 2011 it made the dumb mistake of letting him keep his job.

8. Overpaid for Skype

Microsoft paid $8.5 billion for Skype. Although the acquisition was a good one that should help the software giant compete against Apple's FaceTime, the company overpaid for the voice over IP provider. Skype is a company that has historically failed to generate respectable revenue and profits. With a largely free-to-use business model, it's hard to see how Microsoft will see a positive return on its investment. Microsoft paid too much for Skype. And it's time everyone realizes that.

9. Tipped its Windows 8 hand too early

Although rumors were running rampant earlier this year that Microsoft was launching Windows 8 in 2012, the software giant allowed that information to slip too soon. By effectively pre-announcing Windows 8, Microsoft put many enterprise road maps on hold as IT decision makers consider whether they should go forward with plans to deploy Windows 7 PCs or wait for the next operating system. Consumers, meanwhile, are also likely to wait on buying a new PC until Windows 8 is out. Microsoft should have waited until 2012 to show off Windows 8.

10. Failing to make the mobile space about security

Microsoft this year tried to play too nicely with its mobile competitors. In the meantime, it hurt its standing in that market. One of Microsoft's key strengths in the mobile space is security. Unlike Android, which has been hit hard by security woes, experts agree that Windows Phone 7 can hold up to the vast majority of threats. Why not make that a talking point and draw a clear distinction between both platforms?

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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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