It really is a new Microsoft

It really is a new Microsoft

Summary: Microsoft's new CEO, Satya Nadella, faced plenty of skepticism when he took the job earlier this year. But even skeptics have to admit that things have changed in Redmond. Here are four things the old Microsoft would never have done.

SHARE:
msftbuild-499

Meet the new Microsoft.

Satya Nadella took over the reins in Redmond earlier this year, with more than a little skepticism about his ability to turn the slow-moving behemoth that is Microsoft.

But things have changed under Nadella's leadership. Here's an update on just what makes the new Microsoft different from its predecessor.

They can keep a secret.

This week, Microsoft delivered a surprise update to Office for iOS.

It wasn’t the first surprise this year from a company that has gotten very good at keeping secrets. Consider these examples:

  • In May, the company launched the Surface Pro 3 in New York. The rumor mill had expected a small tablet, but that project was shelved just a few days before the event.
  • The big reveal for the next-generation of Windows included a new name, Windows 10. No one saw that coming.
  • Some rumors had hinted of a Microsoft wearable device, but no one predicted the Microsoft Band.
  • The new Outlook for Mac and major Office updates for Office on iOS and Android both arrived this week without advance warning.

The old Microsoft was never able to play this game well. But the Nadella-era Microsoft has become quite adept at playing its cards very close to the vest.

They play well with others.

Through the years, one of the great strengths of Microsoft as a company has been its ability to attract developers to its own platform. Lately, it’s been playing that game in reverse, adapting its own software and services to other platforms at an accelerated pace.

Last year at this time, Office for iOS was still just a rumor, and there was still considerable debate over whether an Android version of Office was even a possibility.

That all changed with the launch of Office for the iPad in March. In the intervening months we’ve seen a flurry of updates, culminating in this week’s release of refreshed Office apps (Word, PowerPoint, and Excel) aimed at the larger iPhones.

But the much bigger news was Microsoft’s plan to give Android users an Office alternative to Google Docs. Given the bitter rivalry between Microsoft and Google, this Twitter exchange between Satya Nadella and Google's new top dog Sundar Pichai had to blow a few minds:

satya-and-sundar-v1

The bottom line: Microsoft is aggressively developing its desktop and mobile apps and services with a realpolitik approach that acknowledges the power of the platforms it doesn’t own or control.

They’re not afraid to play hardball with pricing.

Back in the 1990s, when Microsoft was at the height of its monopoly power, it changed the competitive landscape with a single dramatic move, making its Internet Explorer browser free across platforms.

That same spirit is in evidence with some of Microsoft’s recent pricing moves.

  • The first release of Office for iOS required an Office 365 subscription to unlock even basic features. Beginning this week, core editing features are free, and refunds are available to anyone who paid for an Office subscription just to get access to the iOS apps.
  • The amount of OneDrive cloud storage available for free has been steadily creeping up. It’s now at 15 GB, and Office 365 subscribers who pay as little as $70 a year get unlimited OneDrive storage as part of the deal.
unlimited-storage-office
  • To play in the consumer space, Microsoft is giving away what used to be its core product, Windows. Hardware partners who used to pay $20 and up for every copy of Windows can now get it free for use on phones and tablets that are 9 inches or smaller.

Windows is still a cash cow, but it’s no longer a sacred cow.

A decade ago, Windows was the source of virtually all of Microsoft’s operating income. Today Windows is still a major contributor to Microsoft’s revenue, but it’s no longer the biggest number on the balance sheet.

In the credit-where-due department, ex-CEO Steve Ballmer was in charge for most of that transformation. The biggest move this year has been psychological.

Pre-Nadella, "first and best on Windows" was the guiding principle for Microsoft apps and services, including Office and Skype. If that mindset were still in place, Microsoft might have delayed this week's Office for iOS launch until corresponding versions for Windows were ready.

That didn’t happen. In fact, as of this week, if you want the best experience of Office on a mobile device, you should put down that Windows tablet and pick up an iPad.

That would have never happened with the old Microsoft.

Topics: CXO, Cloud, Microsoft, Windows, Windows 10

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

248 comments
Log in or register to join the discussion
  • Your thoughts on the new Microsoft?

    Is this really a new guard? Or is this just a case of "Meet the new boss, same as the old boss"?

    Share your comments, but as always I ask you to play nice and avoid personal remarks.
    Ed Bott
    • It's good to see: They can keep a secret.

      Under the heading of, loose lips sink ships it's comforting to not hear bla bla ... anonymously because they were not authorized to speak.

      IDK if they are using Agent Smith (from the Matrix) to seal their mouths but I'm glad it's working. Maybe they can export this technology to the Government alphabet soup agencies.
      greywolf7
      • Not a New Gaurd

        One of Microsoft's greatest strengths has been its ability to recognize market and technology changes. They have been able to match and exceed these changes. How many times has this happened? Windows, Security, Office, Games, and more. I think it is all just another case of their flexibility as market and technologies change.

        Note, they often get in more trouble when they move too fast rather than to catching up.
        MichaelInMA
        • Not their greatest strength, at least pre-Nadella

          Actually, one could argue that some of the ideas that MS has had over the years were visionary, but ahead of their time and poorly executed (whether marketing, consumer education, advertising or not feasible given the available technology).

          But the crux of MS's problems right now stem from the fact that they did not foresee rise of mobile tech and are very late to the game.
          jlongino
          • Ironically, Apple and Microsoft both started their tablet projects in 2009.

            It took Microsoft longer because they wanted their tablet to be fully integrated into the Windows world.
            M Wagner
          • No

            The iPad began before the iPhone, in the early 2000s. There's a famous story that Jobs was an annoyed by a Microsoft employee he knew boasting about the XP tablets, so he ordered his staff to make something better. He had a revelation about phones some time later, and told them to shelve the iPad for now, and make it work as a phone... going back to the iPad after the phone came out.

            Read Isaacson's book, should you doubt.
            Mac_PC_FenceSitter
          • It was the ipod though

            The phones came out of the ipod product line which was built on making DRM deals with music companies. That was Apples first big success pretty much since the beginning.
            Buster Friendly
          • The iPad did actually have a separate origin

            Fence sitter is right. Apple had a long history of Newton tablet devices, and it was tablets running XP that lead to the iPad. Apple had just ditched system OS for the Unix based Mac os X, and they wanted to bring the capabilities of OS X to a tablet like windows had done. They knew from their newton experience that a tablet needed a custom user interface. It was actually part of their computer progress initially. As fencesitter stated, by 2004 they had realised that the changes to OS x in their mobile OS, their hardware and usage would suite a phone and the tablet was delayed.

            The iPods actually belong to the apple Hub accessories market - things like digital cameras. They were initially designed to provide nothing more than an MP3 player for Mac owners. Designed in less than a year, they answered the growing demand for MP3 players, especially Mac compitible ones. Of course they then expanded to the PC market.

            As for the DRM and App Store, that all actually evolved. iTunes was originally the new media player for OS X. It was bought from another company and was used to digitise your existing music collection. It was another year before the iPod came out, and another 3 before they launched the iTunes store. Even with the original iPhone there were no third party apocations at all - just web apps. It was a year before the App Store came out.

            The connection between the iPod and ios is that well after the iPhone had already taken over from the iPad, by as much as a year, the iPod dev team and the Macintosh dev teams are said to have competed on how to implement OS X into the iPhone, with the IPod team starting from the iPod angle and the Macintosh team starting from the desktop angle. The iPod team won, but the decission to port OS X onto a phone had already been made and been in active development for a year, a couple of years before that as a tablet.
            MarknWill
          • the first tablet

            Was by Xerox, at PARC
            ray746
          • true

            And the first computers were made during the second world war.

            They aren't much related to the ipad though.
            MarknWill
          • And

            what a HUGE mistake that was.
            ctopher5669
        • this Internet thing

          Yea, they didn't miss out of the Internet thing.... people will never pay $500 for a phone, and ..... and.....

          Microsoft missed a load of opportunities over the years. I will say they bullied their way into making Office the Office for business. Smart, bully move there. No more Lotus. Looks like Novell took a few gut punches along the way.

          Yes, Microsoft did get some things right.
          mytake4this
          • Like all the other bullies

            You got to be a bully to be on top. Look at Apple, Look at Google - all big bullies pushing their weight around.
            James_SB
          • Not true at all. When Office (Word + Excel) first shipped together ...

            ... WordPerfect and Lotus 1-2-3 were king and queen of the Business Apps. Neither one responded with a product that was fully integrated into Windows. That was not Microsoft's fault.
            M Wagner
          • ms said office apps would workthe same

            Yet to this day the settings panels for each office app have massive inconsistencies for layout... evendors when the ribbon was introduced it wasn't universally applied. Srill, it's a nitpick. Office was the best suite available. Until subscription licensing renders costs more over time but with no new feature.
            HypnoToad72
          • Re: the internet thing

            [quote]Yea, they didn't miss out of the Internet thing.... people will never pay $500 for a phone, and ..... and..... [/quote]

            For the most part, MS was/is correct. People won't pay that much for a phone. They'll pay $200 and pay more for the plan, but the iPhone really took off when they adopted the same subsidized model as all other U.S. phones used (even if the phone ultimately cost more that way).
            notsofast
          • right

            In fact, Microsoft did get many things right.
            nafaabout@...
      • huh?

        Don't see how you can believe him when he says they can keep a secret when all of those Windows leaks were happening 2 months before the announcement of Windows 10...there were CONSTANT leaks. We even knew about the Surface Pro 3 months before the official announcement.
        JJ82
        • Who knew about the Band? noone.

          Who knew about Office on iOS. Noone.

          No big organization changes overnight and Satya wasn't appointed CEO until Feb 2014.

          Surprises in Windows has never proven to be a good thing. Not everything will be handled the same way. Public Betas pretty much obviates any secrecy.
          greywolf7
          • Band?

            Such a good secret this is the first I have heard about it and still have no idea what it is. Great publicity they have going...
            dumb blonde