Windows 8

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Windows 8

Microsoft plans to launch Windows 8 later this year. And when it does, the company hopes that consumers and enterprise users will warm to the idea of having a totally new design. If they do like it, Microsoft can all but ensure its success in the coming years. But if things turn sour, there's a chance Windows could be on a slippery slope.

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Surface Tablet

Microsoft has finally decided to break into the tablet space with the Surface. By all measure, the device is a fine potential competitor to the iPad and could very well be the enterprise's choice for a slate, thanks to its integration with Windows 8 Pro. If it succeeds, Surface could cement Microsoft's position in the tablet market. With failure, who knows what the future holds for its mobile division?

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Microsoft's Bing is the company's last best defense against Google Search. The search engine recently received a "major update," featuring three columns. The issue, however, is that its market share still trails far behind Google's. Bing doesn't have to be dominant in the coming years, but it certainly needs to start chipping away at Google's lead.

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Although Microsoft is best known for Windows and business applications, the company has been slowly but surely becoming a dominant player in the gaming space. The software giant's Xbox 360 consistently tallies the highest sales of any device in the U.S. market, and next year, it's expected to launch a new console to continue that. It should be interesting to see how that all plays out.

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It's no secret that the cloud is the future. And Microsoft, with SkyDrive and Azure, among other platforms, seems to realize that. But the company was slow in acknowledging the potential of cloud applications so far and it has been playing catch up. Microsoft is nowhere near becoming a dominant player in the cloud computing space. It needs to keep growing its cloud offerings before it can hope to become an obvious winner in the cloud market.

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Microsoft CEO Steve Ballmer is an enigma to many public company handicappers. On one hand, he's done a fine job by financial standards, helping his company generate billions of dollars in profit each quarter and maintain value for shareholders. On the other hand, Microsoft's mobile division has struggled under his watch and so far Microsoft has failed to find a way to match or counter Google's growth in search and mobile operating systems. Ballmer is a big question mark for Microsoft's future right now. He has to show he can keep Microsoft strong and pass on a vibrant, innovative company to the next generation.

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Online Services

Beyond the cloud and Bing, it's important for everyone to realize that Microsoft cannot maintain its position in the industry unless it can deliver a host of online services that people are after. That means expanding SkyDrive and perhaps offering streaming services to compete with the likes of Netflix and Pandora. Like it or not, Microsoft must become an online-focused company at some point in the next couple of years, or face being boxed out of that space.

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There's something to be said for Office. For years, the platform has been the go-to service for those who want to get work done at home, in the office, or at school. And despite so many attempts by competitors, it's still the top player in the productivity market. However, in the coming years, as software transitions to the Web, Microsoft will need to be able to transition with it. Office is very much a going concern for Microsoft.

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One of the biggest mistakes Microsoft has made over the years has been its inability to adapt to the changing times. The massive company has become too monolithic as competitors transition to new models with greater ease and agility than Microsoft can exhibit. Adaptability is the difference between success and failure today. Microsoft must demonstrate that it understands that.

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Tablets, Tablets, Tablets

According to Microsoft, with Windows 8, its vendor partners will be able to make a strong push for tablets. However, market analysts aren't predicting that Microsoft will capture a big share of the tablet market share in the next few years. Success in the mobile space relies on a company's ability to appeal to tablet buyers. Microsoft should keep that in mind.

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Key Acquisitions

At the end of the day, Microsoft must continue to remember that making strategic acquisitions can do a world of good for its business. That's why its acquisition last year of Skype was such a good plan. It's also why the company should put some of its billions in cash reserves to good use this year. In order for Microsoft to quickly succeed in key markets, it must acquire companies with innovative new products and technologies.

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