10 Things Microsoft Must Do to Stay Relevant for the Next 40 Years

by Don Reisinger

Microsoft CEO Satya Nadella has clearly stated the company’s future growth will be on mobile devices. In a long manifesto last year, he said that mobile would play a crucial role in his company’s future and he even indicated that Microsoft must accept market dynamics and appeal to those working with devices running iOS and Android. So far, Microsoft has done that, and according to the company, it’s working out well.

Windows 10 will right the sins of Microsoft’s past. Windows 8 has been called one of the most disastrous Windows versions of all time. The operating system was too different for those who have been using Windows for a long time. So, Microsoft has gone back to the future a bit, providing updates that bring back the Start Menu, make it feel more like Windows 7 and strip away many of the Windows 8 features that turned off users.

Microsoft’s Azure cloud computing platform is crucial to the company’s future. Microsoft is engaged in an intense competition with the likes of Amazon, Google, IBM and a number of other top companies to be a leader in delivering cloud computing services. Microsoft has steadily expanded its Azure service offerings to help enterprises go virtual, reduce their IT data center overhead and dedicate more of their budgets to cloud software that enhances productivity. Azure has proven popular so far and likely will remain so in the coming years.

As noted, Nadella has said that he wants to be mobile-friendly, no matter the platform. But as time goes on, Microsoft needs to be even friendlier to iOS and Android users, ensuring that they get updates to Office first, they have the ability to use apps that would link their devices and Microsoft’s other platforms, and more. Being mobile-friendly is one thing, but accepting the realities of the space and accepting that iOS and Android are by far leading Windows Phone and should therefore be treated with special gloves is crucial to Microsoft’s success.

Microsoft has made a lot of progress getting enterprises to move to Office 365, the company’s office productivity software-as-a-service suite that allows individuals and companies to run a wide range of applications and services both on the desktop on online. But Microsoft has to continue to win market acceptance of this cloud suite to face the prospect that Google or Zoho will steal away more of its productivity market suite.

Microsoft has made several mistakes over the past several years in the mobile, operating system and applications markets. It reacted slowly to the growth of cloud computing and generally looked like a plodding hulk that clung to the past and failed to respond to customer needs. Microsoft must project an image of being nimble and innovative as it was in the company’s early pioneering days.

PC vendors are still crucial to Microsoft’s success in the software space. While the company will be offering free upgrades to Windows 10 to users, Microsoft will still derive much of its Windows revenue through PC sales. If PC vendors gladly buy Windows 10 and bundle it with their products, Microsoft can bolster its financials. If Microsoft turns away PC vendors by offering a product in Windows 10 that people don’t want, it could be a huge issue for a crucial part of Microsoft’s business.

Microsoft has said that Windows 10 will work effectively across all types of products, including mobile and desktop, but that needs to actually happen when the operating system launches later this year. Microsoft is only making promises right now. When customers actually get their hands on Windows 10, they will need to see that it works just as well on a tablet as it would on a laptop. If Windows 10 can’t hold up in mobile, the operating system will fail.

While there are reports that Microsoft could be considering selling its Xbox division, most of those rumors have been brushed aside by analysts who say the gaming division is crucial to Microsoft’s future. The Xbox is the gateway to the living room for Microsoft, which is the place to be to engage younger users who might otherwise move to Macs. Xbox is also the platform to integrate gaming across Windows 10. Don’t kid yourself: Xbox is very important to Microsoft’s future.

Market analysts are convinced the wearables market is set to explode, with revenue generated from that space jumping billions of dollars each year over the next several years. That’s precisely why Microsoft must invest heavily in wearables. The company has already unveiled a device, called the Microsoft HoloLens that provides a holographic virtual-reality experience for users. HoloLens relies on Windows 10 to work, but it could be one of the most important devices that Microsoft markets in the coming years.