Yes, friends, it’s April Fool’s Day, but the only fool in the past decade or so seems to be Microsoft. How so? After all, Microsoft is worth hundreds of billions, has tens of billions in cash, and the stock price has gone up in the past year.
Of Friends And Frenemies
Here’s the problem. Microsoft has been pretty much a sleeping dog since Bill Gates left back around the turn of the new century.
Sure, Windows and Office are cash cows and keep the company’s coffers full of, well, cash. But name another venture that has panned out since then.
Hear those crickets?
Meanwhile, Apple went on a rampage of sorts, re-inventing portable music players, owning online music downloads, opened a few hundred successful and profitable retail stores, re-invented the smartphone and tablet; you get the picture.
These days Microsoft, once the most vaunted and feared software company on earth, is giving away software for free just to survive long enough to figure out a new strategy. Windows is free on cheap PCs. Office is free on Android devices, iPhone and iPad. It’s tough to make revenue and profits when the price tag is free.
Apple put the squeeze on Microsoft from the high end, the premium spectrum for PCs, smartphones, and tablets. The Office-like iWork suite of Pages, Numbers, and Keynote are free. OS X and iOS are free downloads.
That only partially explains why the average price for Windows anything has dropped dramatically in recent years.
At the low end of the scale there’s Google with free Android for smartphones and tablets, and free Chrome for inexpensive Windows-eating notebooks. Microsoft is caught between free. Free software from Google, and free software with every hardware purchase from Apple.
Remember the Microsoft Surface Pro 3hybrid tablet notebook? Alright. Yes, I understand. It’s somewhat forgettable, but it advertises well and gets good marks as a hefty notebook; not so much as a tablet.
Well, Microsoft is adding to the Surface line with a new tablet device starting at $499. Think Intel Atom CPU, 2GB RAM, 64GB storage, but no add-on keyboard. What this 10.8-inch device will come with is a 1920 x 1280 HD screen, Wi-Fi, USB, and even a 4G LTE version later (wouldn’t it be nice to have a Mac with 4G LTE?).
This Surface won’t be a screamer but it comes with dual cameras, weighs only 1.37 pounds, and is barely one third of an inch thick. So, it’s bigger than an iPad Air, weighs more, though it runs Windows 8.1 (Windows 10 is a free upgrade when it ships). And, it comes with a subscription to Office 365.
Why is Microsoft doing this?
It must. Apple owns the premium end of the product spectrum; the area where the profits live. Google owns the low end where profits don’t matter and Microsoft is stuck in the middle, trying to compete on hardware and software. The idea is to make both Windows and Office everywhere on today’s new mobile devices in the hope– and it’s just a hope– that users will stick around and pay money every year thereafter for a subscription to Office 365.
Good luck with that.