Microsoft: We are focusing on eight core businesses

Summary:At the kick-off of the company's annual Financial Analyst Meeting (FAM) in Redmond on July 29, Microsoft execs attempted to clarify where the company is focusing its efforts currently and in the coming year.

Microsoft critics tend to knock the company for being either too reliant on its cash cows (Windows and Office) or too scattered, chasing too many nonprofitable businesses.

At the kick-off of the company's annual Financial Analyst Meeting (FAM) in Redmond on July 29, Microsoft execs attempted to clarify where the company is focusing its efforts currently and in the coming year. Officials also emphasized repeatedly that in spite of all its talk and high-profile marketing push on the consumer front, Microsoft's enterprise products constitute a huge part of the company's revenue base.

Actually, Microsoft has eight core focus areas, General Manager of Investor Relations Bill Koefoed, told the Wall Street analysts (and a few of us press types) attending the day-long event.

The eight, according to Koefoed:

  • Xbox and TV
  • Bing
  • Office
  • Windows Server
  • Windows Phone
  • Windows
  • Business users
  • SQL Server

How does the cloud fit in? As Microsoft phases in more cloud offerings, things like Windows Azure, SQL Azure, Business Productivity Online Suite (BPOS), Windows Intune (system management service), they will replace these core products. Example: SQL Azure will come to replace SQL Server for at least some customers at some point.

Koeford said there are a number of "enablers" of these eight, specifically:

  • Stores and marketplaces
  • Services and support
  • MSN
  • Mice/keyboards
  • Mediaroom (IPTV)
  • Visual Tools
  • Windows Live
  • Dynamics (CRM and ERP)

Koefoed showed a breakout slide that showed plainly that enterprise customers are the largest user segment for Microsoft. Here's how Microsoft's customer base looks today:

  • Enterprise 35.8%
  • Small/midsize business 20.5%
  • Consumer and online 16.9%
  • OEM 26.8%

Chief Operating Officer Kevin Turner said that in fiscal 2011 (which commenced on July 1 for Microsoft), Microsoft will be leading with the cloud when it sells. He said this positioning will allow Microsoft to sell more on-premises products than ever before. Microsoft is characterizing its cloud play as "IT as a service" as a way to make clear that its cloud products are aimed at IT pros, not just developers.

Microsoft also will continue to drive Windows 7 and Office 2010 in the coming year, Turner said. He said to expect a public beta of Internet Explorer 9 in September 2010.

What's your take? Is eight too many cores for Microsoft to focus on?

Topics: Data Management, Data Centers, Enterprise Software, Microsoft, Operating Systems, Software, Windows

About

Mary Jo Foley has covered the tech industry for 30 years for a variety of publications, including ZDNet, eWeek and Baseline. She is the author of Microsoft 2.0: How Microsoft plans to stay relevant in the post-Gates era (John Wiley & Sons, 2008). She also is the cohost of the "Windows Weekly" podcast on the TWiT network. Got a tip? Se... Full Bio

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