Six impossible things Satya Nadella has already done

What we're seeing from Microsoft today didn't happen in five short weeks, but there are plenty of things the company's new CEO deserves credit for.
Written by Mary Branscombe, Contributor
Some of Microsoft’s recent resurgence is down to ex-CEO Steve Ballmer. But new CEO Satya Nadella has clarified the One Microsoft message and got people believing in the company again. Image: Microsoft

Microsoft is enjoying a resurgence that many attribute to its new CEO. Satya Nadella is certainly galvanising the company, and the enthusiasm of product teams at the recent Build 2014 conference was noticeable. But for those who have tracked his career at Microsoft, the fact that Nadella's second month in the CEO seat sees the company's stock price climbing high isn't out of step. Like the White Queen, Nadella has been associated with a few things usually considered impossible at Microsoft.

He moved from sales to engineering

Nadella was hired from Sun, and his first job at Microsoft was on the WebTV project — a service that went from being a cheap computer for the non-technical to a set-top box service delivering TV over the internet, losing its founder along with its broader vision. It was acquired in 1997, just as Microsoft fought off an attempt to reopen the DoJ case against the company, and killed in 2013 just as Apple was starting to get somewhere with Apple TV. Although WebTV is the reason Microsoft has a campus in silicon valley, it never gave Microsoft the foothold in the living room it was hoping for and WebTV hasn't always been a positive thing to have on your CV at Microsoft.

He saved Microsoft's web search

Like the look of Cortana? Enjoy voice controlling your Xbox One? Both rely heavily on Microsoft's Bing search service, which is really a large machine learning system (just like Google). Bing is still a distant second in web search, but it's far more successful — and works far better — than its predecessor, Live Search. That's thanks to the FAST search team Microsoft bought to improve SharePoint and the PowerSet team purchased for its work on understanding the concepts behind the things we search for. It's also thanks to lots of hard work from the Bing engineers and the researchers at MSR — and the head of the division when all of this work was being done, Satya Nadella.

And if you're going to get an understanding of the complex business models of ad-supported and freemium services in a highly competitive market, web search is an excellent place to do it.

He took over from Bob Muglia and nobody hated him for it

Nadella replaced the much-loved, deeply-respected Bob Muglia as the head of the server and tools business. It's widely believed that Muglia left because he wasn't 'all in' on the cloud and didn't believe Microsoft's cloud products were mature enough to focus on. It's hard to replace a popular leader, but Nadella did it without any backlash — even while taking the direction that Muglia seems not to have agreed with. That's a sign of a good leader.

He made Azure relevant

The transformation of Windows 7 into a secure, fast, high-performance operating system went hand-in-hand with the work done to deliver Windows Server 2012, which has been Microsoft's most successful server OS, with virtualisation features that match and often leapfrog VMware (particularly software-defined networking). But at the same time, under Nadella, Azure went from being a minimal service that was too far ahead of what business customers actually wanted, to a powerful way to exploit the efficiencies of a giant, heavily automated data centre; it became far cheaper to run the server workloads customers still wanted, and they could be enticed to try out services for running websites, hosting data and other Platform-as-a-Service tasks.

Today Azure is coming out with new features every three weeks, hosting more customers than anyone else in the cloud and underpinning everything from Apple's iCloud to Samsung Smart TV to NBC's streaming of the Olympics. It's Microsoft's poster-child for cloud, along with Office 365 (also delivered on Nadella's watch), and there wasn't much at the Build conference that you can't connect back to Azure in some way.

He made 'devices and services' make sense

On his very first day as CEO, Nadella described the 'devices and services' strategy, which Steve Ballmer had been pitching since the One Microsoft reorg last year, and got people to understand it by using the word 'software' — which is what everyone associates with Microsoft. Devices was never just Surface and Xbox; it was always about Microsoft finding a way to be relevant on all the different devices we use today — from Kindle to iPad and Android phones to wearables such as socks that sense how fast you're running. And services was never just Microsoft's own services such as Office 365, Azure and Bing; it was always about working well with other services — like the way you can sign a document that lives on Office 365 using the DocuSign app on your iPhone because the services work together.

Ballmer never managed to clearly explain the breadth of the 'devices and services' vision; under Nadella, Microsoft has announced and launched multiple examples, from Office for iPad to Cortana (a Bing service on a Windows Phone device).

He took off the brakes at Microsoft

Nadella's real strength may prove to be that he saw the breadth of the open, cross-platform innovation that was already happening at Microsoft and saw how to build that into a blueprint that delivers the devices and services, cloud-and-mobile-first strategy that's getting Microsoft such positive comments.

After all, five weeks isn't long enough to write Office for iPad (or OneNote for Mac); it's barely even enough to get Office for iPad through the approval process for the App Store, which is probably what fixed the launch date (once the Office team had abandoned their almost-finished iOS 6 version and rebuilt it for iOS 7). Getting Samsung to use Microsoft's rights management service to secure documents inside Knox, or LiveScribe to support the new OneNote API, didn't happen overnight either. And Ballmer signalled dropping the cost of Windows Phone and Windows licences pretty clearly at the last shareholder meeting.

There will be projects where Nadella is reaping what Ballmer sowed, as well as initiatives he's greenlit himself. But it's clear from Build 2014 that Nadella has got people believing in Microsoft again — especially the people who work there.

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